Shoshana Grossbard-Shechtman

A consumer theory with competitive markets for work in marriage

The theory presented here aims at explaining individual consumer behavior inside marriage and prior to marriage. It is a New Home Economics (NHE) model in the sense that it assumes the existence of household production. It is an intra-household bargaining model in the sense that it assumes that husbands and wives typically have different economic interests with respect to marriage, and they try to negotiate arrangements that suit them best. The more resources they have, the more they may obtain results that favor them rather than their spouse. It is a market theory similar to standard labor market theory. This theory throws light on gender differences in demand for commercial goods that have home-produced substitutes. This theory leads to an explanation why women are charged more for dry-cleaning. The theory can also explain differences in demand for different products. Predictions include that of a sex ratio effect on consumption. For example, it is predicted that in countries with more emigration of men than women, women will be expected to make higher contributions to newly weds’ costs of housing. It is also predicted that there will be compensating differentials in marriage. For instance, women married to considerably older men are expected to have relatively more control over the use the couple’s income than women married to men who are close to their own age. In contrast to bargaining theory, the insights presented here apply to both married individuals and to those who anticipate being married in the future.

The Extra Burden of Moslem Wives: Clues from Israeli Women's Labor Supply

This paper examines differences in the labour supply of women of different religions in Israel. We estimate religious differentials in the effect of husband’s income, number of children, education, and age on married women’s labour supply. It is suggested that labour supply patterns of wives from different religious backgrounds may reveal differences in the institutions which different religious groups have established to regulate marriage and divorce. Our results suggest that Christian marital institutions are closer to Jewish marital institutions than they are to Moslem marital institutions. Moslem women appear to be less likely to translate their resources into a higher value of time in marriage than either Christian women or Jewish women. Educated Moslem women seem to have fewer constraints on their marriages than their uneducated counterparts.

The New Home Economics at Colombia and Chicago

When Jacob Mincer and Gary Becker started the New Home Economics (NHE) at Columbia University in the early 1960s, they expanded on the field of family and consumption economics that Hazel Kirk and Margaret Reid began in the early 1920s. This paper studies forty years of household economics, the decisions that household members make regarding any allocation of resources. These decisions may regard consumption, labor supply, transportation, fertility, or health. A review of the history of the NHE shows that Jacob Mincers original contribution tends to be underestimated. This paper also argues that the growth of the NHE benefited from the concentration of talent at Columbia, organizational support, the diversity of a student body that included many talented women, the ideological commitments that students, many of them married, had for the study of home production, a departmental policy de-emphasizing gender-related politics, and relatively high levels of civility.

Marriage contracts and the law-and-economics of marriage: an Austrian perspective

Marriages and firms share many characteristics in common. Both institutions deal with a set of promises between two parties and therefore need contracts to encourage individual parties to stand by their promises and commitments. Despite these similarities, in most countries marriage laws are statutory laws that have little in common with commercial contract laws. We present the Chicago and neoclassical perspectives on law-and-economics, with a special emphasis on marriage laws. According to this framework, it is possible to explain the way traditional marriage laws have regulated exchanges between spouses and spouses in Western countries such as France, when these countries were patriarchal societies. We also consider the case of egalitarian marriage and show some of the limitations of any statutory marriage laws. We then present a critical perspective on the law-and-economics literature on marriage. Our critique is based on the economic literature by Austrian economists and by public choice theorists. We emphasize the knowledge problem, the problem of interest, and the problems associated with government monopoly in coercion. Our concluding section presents some suggestions regarding a legal system inspired from international commercial contract law. By not giving any particular government a monopoly on the power to enforce marriage contracts such system would avoid some of the problems found in the systems of statutory laws currently regulating marriage and divorce in the Western world.

Marriage and the Economy: Marriage and Work for Pay

This chapter reports some differences between married and unmarried people – marital differentials – with respect to the following characteristics of paid employment: labor force participation, labor force attachment, and wages. Most of the evidence that we report is for the United States, although we also report patterns for some other parts of the world. We also explore some ethnic variations in marital differentials, and some changes over time. Observed relationships between paid employment and marriage may have three possible causes: Marriage may affect labor market experience, labor market experience may affect marriage, or the relationship between marriage and labor market experience may be explained by third factors influencing both marriage and paid employment. Any explanation of marital differentials in paid employment has to start by recognizing these two facts: Marriage is an institution that organizes household production, and work in household production is a major alternative to paid employment. Gender differences in labor supply and earnings have been well documented, and we look at women and men separately. These gender differences could be related to gender differences in household production (see Chapter 9 by Joni Hersch). At least since Jacob Mincer (1962), it has been postulated that for women household production and paid employment are inversely related. We then present econometric models that attempt to disentangle causal relationships. We also present marriage market models that lead to the inclusion of marriage-related variables that are usually overlooked in labor supply models, including a number of individual characteristics (such as age, ethnicity, and religion) and aggregate characteristics (such as sex ratios and government policies) that are expected to affect opportunities in marriage and labor markets.

Women's Labor Force Participation and Status Exchange in Intermarriage: A Model and Evidence for Hawaii 1

Womens labor force participation, ethnic status and interracial marriage are examined in this paper to test Grossbard-Shechtmans marriage market theory. Perceived racial and ethnic group status is found to be an important attribute in marriage market exchange that combines marriage and working outside the home. Caucasian women, who have a higher perceived ethnic status, tend not to work when they marry men of a lower perceived ethnic status, while the opposite is found of women who have a lower perceived group status and who marry into a higher-status group. This is especially of women with low education, while highly educated women are less affected by compensating differentials at marriage as related to ethnic status of the couple. Ethnic groups that have a recent immigration history also have a different pattern of intermarriage and womens labor force participation.

Comment on “a theory of the value of children”

The authors dispute the theoretical model proposed by Friedman Hechter and Kanazawa on the value of children in developed countries that is related to the capacity to reduce uncertainty for individuals and to enhance marital solidarity for couples. The authors of this paper argue that the proposed theory has limited potential is internally inconsistent and fails empirical tests. Friedman et al. recognize other reasons for giving value to children that include the expansion of the self an outlet for creativity and desire for accomplishment and an opportunity to guide teach and exert control. It is argued that marriage creates uncertainties and it is not plausible that parenthood uncertainty is any less than uncertainty associated with labor force participation or marriage. Desire for control is more plausible as an explanation for the value of children which is in agreement with the proposed theory. However it is argued that focusing on the precise nature of why parenting occurs is not a good point of departure for exploring systematic variation in fertility behavior. It is argued the first and second hypothesis are contradictory. Evidence is given that supports a negative rather than the proposed positive relationship between divorce and fertility. Evidence is also presented that supports the opposing theory that differences between spouses in education religion race age intelligence and race are associated with a smaller family size. The literature indicates both that marital satisfaction is higher among couples who are voluntarily childless and that marital satisfaction is lower. Empirical evidence is lacking about the influence of strong support from outside sources on fertility. It is viewed as likely that the profamily context of Orthodox Jews supports higher fertility. It is argued that the proposed theory does not distinguish between marital and nonmarital childbearing. It is posited that there is strong support for the rational choice and human capital theory of fertility. Marital status is conducive to childbearing and that strong unions are likely to have higher fertility.

When do spouses support a career? A human capital analysis of Israeli managers and their spouses

Abstract This study examines the factors that contribute to a managers receiving spousal support for his/her career. Two theoretical approaches-human capital and cultural norms—generate hypotheses tested on a sample of 869 men and women managers in Israel. Results of linear and logit regressions, run separately by gender, with education, earnings, age, children, religiosity, and ethnic origin as independent variables, revealed that spousal support is better explained for women than for men, and that husbands help more when it is most productive to do so. Cultural norms also contribute to explaining spousal support.

Irma Adelman: A Pioneer in the Expansion of Economics

Major innovations and extensions require that economists change their focus. This entails the destruction of some of their human capital. Even though this is a process of creative destruction, typical of progress in industry, the process is somewhat painful and therefore is not undertaken lightly. Typically, most of the enthusiasm for our work on social and political aspects of economic growth was expressed by people either at the very top of our profession, who had human capital to burn, or by new entrants into the profession, who, as yet, had no human capital to lose. And, most of the resistance to our work came from the middle of the profession, who either could not afford to lose any human capital or could not be bothered to engage in the relearning effort required to absorb it. The initial reactions to our work exemplified this dualism. . . . Many graduate students came to Berkeley from all over the world in order to study under me. I then discouraged them from writing dissertations in the interdisciplinary tradition, fearing the potential damage to their careers.

Do not sell marriage short: Reply to strober

This paper explains why marriage market conditions may affect the participation of women in the labor force. In particular, it is claimed that changes in cohort size affect marriage market conditions and therefore womens labor-force participation. The paper also indicates how a theory of labor and marriage based on market analysis can possibly help womens causes. The paper first addresses theoretical issues raised by Strober. It then responds to her critique of empirical work.