Economics in a Family Way

This paper is an advertisement for some facts and ideas that I think likely to lead to a richer theory of the economics of the family. The discussion references many papers from anthropology and biology. Because of the intimate connection between the family and reproduction, it should not be surprising that there is much to be learned about the economics of the family from the study of evolutionary biology. Given the increased prevalence in recent decades of unwed parenthood, divorce with sequential monogamy, and ``non-traditional'' family arrangements, it also seems plausible that anthropological studies of alternative family structures would help us to understand our own. The first section presents an evolutionary theory of interpersonal sympathy among family members. It discusses the genetic theory of kin selection and its implications for human preferences and relate these ideas to theories of the cultural evolution of preferences. The next section takes an evolutionary viewpoint in exploring the riddles posed by the demographic transition and the question of intergenerational flows of wealth. The third section discusses non-monogamous family structures in our own culture and in other cultures. The final section draws on a more traditional source of inspiration for economists. This section outlines an approach to bargaining theory within the family based on recent discoveries in non-cooperative game theory and discusses ways of integrating the theory of spousal bargaining with the theory of marriage markets.(Revised, January 1966)