Spousal Bargaining Power and Consumption of Married Couples in the US: Evidence from Scanner Data

52 Pages Posted: 15 Apr 2022

See all articles by So Yoon Ahn

So Yoon Ahn

University of Illinois at Chicago - Department of Economics

Yu Kyung Koh

Columbia University, Department of Economics

Date Written: March 1, 2022

Abstract

This paper studies how spousal bargaining power affects consumption patterns of married households in the US, using a detailed barcode-level dataset. We use two distribution factors as proxies for spousal bargaining power: (1) spouses’ relative education and (2) spouses’ relative potential wage, which is our preferred distribution factor. As an arguably exogenous measure of bargaining power, our relative potential wage is constructed as a Bartik style measure of female-to-male wage ratio, exploiting county-level variations in heterogeneous exposure to different industries and state- wide wage growth. We find that the expenditure shares on women’s beauty goods increase and the expenditure shares on alcohol decrease significantly both when relative education of wife increases and when relative potential wages of wives increase. These results are consistent with household bargaining explanations. For couples with children, improved women’s household bargaining position is associated with higher budget share on books, stationary, and school supplies, which are potentially related to investment in children. For singles, we do not find statistically meaningful effects of relative potential wage on any of their consumption outcomes, which strengthens the interpretation that the relative wage only affects couples’ consumption decisions.

Keywords: intrahousehold bargaining power, consumption, household behavior, gender wage gap

JEL Classification: D10, D12, D13, J01, J16

Suggested Citation

Ahn, So Yoon and Koh, Yu Kyung, Spousal Bargaining Power and Consumption of Married Couples in the US: Evidence from Scanner Data (March 1, 2022). Available at SSRN: https://ssrn.com/abstract=4073740 or http://dx.doi.org/10.2139/ssrn.4073740

So Yoon Ahn

University of Illinois at Chicago - Department of Economics ( email )

725 University Hall (UH)
Chicago, IL 60607-7121
United States

Yu Kyung Koh (Contact Author)

Columbia University, Department of Economics ( email )

420 W. 118th Street
New York, NY 10027
United States

Do you have negative results from your research you’d like to share?

Paper statistics

Downloads
214
Abstract Views
1,128
Rank
254,926
PlumX Metrics