Bargaining and Distribution in Marriage

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Bargaining and Distribution in Marriage

Journal article

By: Shelley Lundberg and Robert A. Pollak

Date: 1996

Source: Lundberg, Shelley, and Robert A. Pollak. "Bargaining and Distribution in Marriage." Journal of Economic Perspectives. 10 (1996): 139.

About the Author: Shelley Lundberg is a professor of economics at the University of Washington who specializes in the study of family economic relations. Robert A. Pollak is a professor of economics at Washington University in St. Louis, Missouri. The two have collaborated on a number of scholarly articles about family economics.

INTRODUCTION

The distribution of financial responsibilities between the marriage partners has undergone significant change in the past 100 years. The institution of marriage as a one-man, one-woman, lifetime proposition has given way to a multitude of variations, each with its own distinct financial considerations and responsibilities.

Until 1960, most developed countries in the world, whether they evolved from the Anglo-American legal tradition or the community property regime found in European countries such as France, had similar rules regarding the financial distributions created by marriage. All spouses were obligated to provide for one another; all parents were obligated to support the children who were the product of a marriage; all adult children were obligated to support their parents when necessary.

The general rules regarding matrimonial property in these countries were also similar to one another. Property acquired during the course of a marriage was usually deemed to be jointly owned, and all property brought into the marriage was treated as separately owned by the spouse who originally owned the property.

While the obligations of support and property division have been well defined legally, the organization of financial duties within a marriage have not been. How a marital unit used its financial resources, acquired through income or other means, or who within the marriage was responsible for financial decisions has never been regulated by the state.

In blended families, where one or both spouses may have been married previously and have corresponding financial responsibilities to either children or a former spouse, the bargaining and distribution of financial responsibilities in a second marriage can be complicated. Often the economic power of the new unit is significantly constrained by preexisting obligations, subjecting the financial viability of the new family unit to factors that cannot be controlled.

The old maxim that the man brought home the bacon and the woman cooked it has been rendered largely a historical artifact. Decisions for the modern two-wage-earner couple often include educational choices, questions regarding both the timing and the number of desired children, as well as when and if the female partner will work outside the home. Each of these decisions significantly affect how modern families determine their economic path.

PRIMARY SOURCE

[This text has been suppressed due to author restrictions]

SIGNIFICANCE

In the modern blended and multidimensional family, where the financial obligations of its members often extend in a number of directions, economic planning and decision making can be difficult. Eco-nomic strategies for the blended family stand in contrast to the traditional nuclear family, which could make financial decisions that were solely in relation to the members of the present household, usually limited to two parents and their children.

The traditional male marriage role as breadwinner with the female as homemaker has been the focus of many academic and legal analyses. One motivation for introducing property equalization and support provisions in family law was to redress the traditional imbalance in male and female economic positions if a marriage failed.

'Extended family' traditionally meant three or more generations of blood relatives—grandparent, parent, and child, for example. Today the extended family encompasses the spouse or former spouses of the family member. Unlike the blended family, with connotations that require interaction between its members to function effectively, the extended family is a clinical expression similar to the plotting of the members family positions relative to one another on a chart.

Blended families were a rarer and less well understood in 1975, when the British House of Commons debated the universal child allowance. The generally accepted definition is a family created through a marriage where one or both spouses have been married previously, or have lived in a common law relationship where children were born; where one or both spouses has children from the previous relationship. Today in most Western countries one child in three will be a member of a stepfamily before reaching 18.

The publication of the primary source as part of a greater body of academic literature on family economics is itself significant, given that the science of economics had no such specialties prior to 1970. Such changes in family creation and organization helped establish schools of study throughout the world devoted to the family and its economic structure: Family law practice, the study of women's issues, statistics that describe the changing demographics of family relationships, and economic issues identified through research (such as that carried out by Professors Lundberg and Pollak) now constitute a rich and vibrant interrelated field of modern university study.

With less than 25 percent of Americans now living in households comprised of a once-married pair of heterosexual spouses and children that are the product of their union alone, marriages that create a blended family are often seen in the modern world as a dispassionate social structure, as opposed to an aspect of an accepted romantic or religious institution. Most developed nations have witnessed a similar reduction in the frequency of the traditional marriage and its resulting family structure.

The blended family has altered many long-held assumptions about the family as an economically efficient structure. Traditional theory assumed that families were inherently a positive economic structure, with resources pooled and decisions made to benefit the family membership. A number of modern economists, however, suggest that the blended family may be inefficient and one that generates a negative financial outcome for its members, due to the pressures arising from obligations placed upon it by previous marriages or common law relationships.

FURTHER RESOURCES

Books

Steiner, Leslie Morgan. Mommy Wars: Stay-at-Home and Career Moms Face off on Their Choices, Their Lives, Their Families. New York: Random House, 2006.