In 2021, I was awarded an ERC Starting Grant.
Many important decisions are made by families, not by individuals. While economists have long accepted and studied inefficiencies in product and labour markets, the same cannot be said for their analysis of the family. Dominant economic models of household decision-making assume a utopian scenario characterised by perfect cooperation, commitment, and full efficiency. While elegant and tractable, a range of common family behaviours fall outside the scope of these frameworks. For example, approximately 50% of marriages end in divorce in OECD countries, with the division of assets and custody of children disputed in at least 15% of cases (de Blasio and Vuri, 2013); and resources including money and contraceptives are often concealed by spouses from one another with implications for a range of behaviours including completed fertility, savings, and consumption (Ashraf et al, 2014). This limits our understanding of households as economic units that jointly make consumption and investment decisions (despite potentially conflicting interests), as well as households’ role in helping to insure the individuals within them against shocks. Furthermore, the policy prescriptions implied by the standard models can result in harmful unintended consequences if implemented in contexts where non-cooperative decision-making prevails (Erten and Keskin, 2018; Bobonis et al, 2013).
FEMPOWER will make both methodological and substantive contributions to the economic literature on female bargaining power by harnessing novel sources of administrative and survey data and by building on my expertise in developing innovative ways of modelling family decision making. FEMPOWER will develop frameworks for estimating models of decision-making that can capture potentially inefficient behaviour in three different Work Packages: (1) Violence & Household Decision-Making; (2) Decision-Making at Divorce; (3) Inefficient & Non-Cooperative Households. Each work package will be structured around three complementary activities:
- Developing high quality empirical facts about behaviour in these contexts using novel administrative data sources;
- Deriving the conditions under which new, innovative economic theories of behaviour can be tested and estimated;
- Estimating the key economic parameters of interest to assess the positive and normative impact of policy proposals.
