Essays in Family Economics

Date of Award

Spring 2022

Document Type


Degree Name

Doctor of Philosophy (PhD)



First Advisor

Meghir, Konstantinos


In this dissertation I investigate how family formation decisions interact with otherindividual's choices---including labor supply, savings or separation,---and how these decision shape gender gaps, inequality and child development. "The effects of institutional gaps between cohabitation and marriage". In the first chapter of my dissertation, I examine how institutional differences between marriage and cohabitation in the U.S.---in dimensions such as child custody or property division laws---shape family formation decisions, and how this choice affects family well-being and child outcomes. As cohabitation and non-marital fertility are prevalent in the U.S., mainly among the less educated, policies that change the differences between cohabitation and marriage may have implications for inequality and child human capital. Using rich household data from the National Longitudinal Survey of Youth (NLSY-97) and the Fragile Families and Child Wellbeing Study, I first show that cohabiting couples, relative to married couples, have higher separation rates and on average worse cognitive outcomes among their children. To explain these findings, I then develop an equilibrium model of family formation to analyze what drives the choice between marriage and cohabitation, and how this decision affects intra-household inequality and child outcomes. In the model, after choosing their partners and relationship type in the marriage market, agents solve a life-cycle problem and make decisions regarding female labor supply, savings, and couples' separation. These choices endogenously determine the allocation of private consumption between the partners, and the human capital development of their children. The model incorporates key institutional differences between marriage and cohabitation, including child custody laws, property division laws, and child support enforcement. I estimate the model using data from the NLSY-97, which follows a cohort of men and women born in the U.S. in the early 1980s, over their life cycle. Consistent with the data, the model shows that children born to low-educated cohabiting women accumulate less human capital than those born to married women. This is explained by lower maternal time investments in children and higher separation rates of cohabiting couples. Moreover, using the model I establish a novel pattern: women in cohabiting couples are on a weaker bargaining position than married women. Finally, I use the estimated model to simulate a reduction in the institutional differences between marriage and cohabitation. In a first counterfactual, I equalize child custody laws after divorce and separation, increasing the incidence of joint parental custody after cohabitation. I find that this policy change would make low-educated cohabiting women and their children better off. The equilibrium effects my model allows me to assess are critical for this result: While cohabiting women are worse off under the baseline marriage market equilibrium (as this policy lowers their access to children upon separation), in the new equilibrium cohabiting women are compensated with a higher share of the household's private consumption. This policy change would also contribute to closing the gap in human capital accumulation between children born to low-educated cohabiting and married women. Other counterfactual policies, such as equal division of assets at separation from cohabitation, have negligible distributional effects. "Marriage Market and Labor Market Sorting" (joint work with Ilse Lindenlaub and Ana Reynoso). In the second chapter of my dissertation, we investigate the interplay between sortingin the marriage market (who marries with whom) and sorting in the labor market (who works where), and how this interaction impact income inequality and the gender pay gap. To study this, we develop a novel equilibrium framework in which households' labor supply choices form the link between sorting in the marriage market and sorting in the labor market. We first show that, in theory, the properties of the home production function| namely, whether partners' hours are complements or substitutes in producing a public good---shape equilibrium labor supply as well as marriage and labor market sorting. We then estimate our model using German data to assess the nature of home production. We find that spouses' home production hours are complements, and this complementarity has increased over time from 1990 to 2016. By rising partners' incentives to spend similar hours in home production, this trend strengthens positive marriage sorting and reduces the gender gap in worked hours and in labor market sorting. This puts significant downward pressure on the gender wage gap and within-household income inequality, but fuels between household inequality. "Intra-Household Decision-Making: New Evidence from the Innovation Sampleof the German Socioeconomic Panel" (joint work with Ilse Lindenlaub and Lindsey Uniat). In the third chapter of my dissertation, we document the relationship between maritalsorting and intra-household decision-making, with a focus on consumption allocations and employment changes due to having children. To do this, we leverage novel data from two survey modules that we designed for the Innovation Sample of the German Socioeconomic Panel (GSOEP). Our first finding is that most households in our sample (72%) split private consumption equally between partners. However, a household is more likely to allocate more private consumption to the female partner when she is at least as educated as the male partner. Second, our data shows a substantial gender discrepancy in career disruption due to childbearing: more than 50% of women experience a career disruption around the time of childbirth, compared to only 5% of men. However, women are significantly less likely to experience a disruption when they are more educated than their male partners. Our data shows that women with a higher labor market attachment after having children are also more likely to benefit from a higher share of household resources later on. This suggests that marriage market sorting and the intra-household decision-making process are interlinked in important ways.

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