NBER Working Papers by Shelly Lundberg

The twenty-fifth anniversary of the publication of Gary Becker's path-breaking "Treatise on the Family" provides an occasion to reexamine both the American family and family economics. We begin by discussing how families have changed in recent decades: the separation of sex, marriage, and childbearing; fewer children and smaller households; converging work and education patterns for men and women; class divergence in partnering and parenting strategies; and the replacement of what had been family functions and home production by government programs and market transactions. After discussing recent work in family economics that attempts to explain these changes, we point out some challenging areas for further analysis, and highlight issues of commitment in two primary family relationships:...

Economists usually assume that bargaining in marriage leads to efficient outcomes. The most convincing rationale for this assumption is the belief that efficient allocations are likely to emerge from repeated interactions in stationary environments, and that marriage provides such an environment. This paper argues that when a current decision affects future bargaining power, inefficient outcomes are plausible. If the spouses could make binding commitments -- in effect, commitments to refrain from exploiting the future bargaining advantage -- then the inefficiency would disappear. But spouses seldom can make binding commitments regarding allocation within marriage. To investigate the efficiency of bargaining within marriage when choices affect future bargaining power, we consider the lo...