This article was downloaded by: [115.85.25.194]
On: 24 March 2014, At: 19:33
Publisher: Routledge
Informa Ltd Registered in England and Wales Registered Number:
1072954 Registered office: Mortimer House, 37-41 Mortimer
Street, London W1T 3JH, UK
Feminist Economics
Publication details, including
instructions for authors and subscription
information:
http://www.tandfonline.com/loi/rfec20
Patriarchal Monopoly
and Economic
Development
Dipankar Purkayastha
Published online: 02 Dec 2010.
To cite this article: Dipankar Purkayastha (1999) Patriarchal Monopoly
and Economic Development, Feminist Economics, 5:2, 61-78, DOI:
10.1080/135457099337941
To link to this article: http://dx.doi.org/10.1080/135457099337941
PLEASE SCROLL DOWN FOR ARTICLE
Taylor & Francis makes every effort to ensure the accuracy of
all the information (the “Content”) contained in the publications
on our platform. However, Taylor & Francis, our agents, and our
licensors make no representations or warranties whatsoever as
to the accuracy, completeness, or suitability for any purpose of
the Content. Any opinions and views expressed in this publication
are the opinions and views of the authors, and are not the views
of or endorsed by Taylor & Francis. The accuracy of the Content
should not be relied upon and should be independently verified
with primary sources of information. Taylor and Francis shall not
be liable for any losses, actions, claims, proceedings, demands,
costs, expenses, damages, and other liabilities whatsoever or
howsoever caused arising directly or indirectly in connection with,
in relation to or arising out of the use of the Content.
Downloaded by [115.85.25.194] at 19:33 24 March 2014
This article may be used for research, teaching, and private
study purposes. Any substantial or systematic reproduction,
redistribution, reselling, loan, sub-licensing, systematic supply,
or distribution in any form to anyone is expressly forbidden.
Terms & Conditions of access and use can be found at http://
www.tandfonline.com/page/terms-and-conditions
P ATRI ARCHAL M ONOPOLY AND
E CONOMIC D EVELOPMENT
Dipankar Purkayastha
Downloaded by [115.85.25.194] at 19:33 24 March 2014
ABSTRACT
On the basis of a simple stylized neoclassical model, this paper attempts to
deŽ ne the concept of intra-household rent-seeking behavior. The intra-household rent is determined within the intra-household market for “patriarchal
goods.” The paper shows that inefŽ cient rent-seeking behavior can explain
marginalization of women as economic growth increases men’s real income.
The model may be used to understand why women’s household work may have
a lower perceived value in some households.
KEYWORDS
Intra-household allocation, rent-seeking, female welfare, patriarchy,
economic development
1.
INTRODUCTION
Allocation of resources within the household has received considerable
scholarly attention in recent years. This area is particularly important for
development economists not only because intra-household resource allocation is signiŽ cantly biased against women in many less-developed countries, but also because there has been a growing awareness that removal of
this bias is a necessary condition for economic development.
The literature on intra-household economics views the household: (1) in
terms of a unitary (or dictatorial, or common preference) model where an
altruist husband allocates household resources, or (2) in terms of bargaining models where the intra-household allocation is determined by male and
female mutual altruisms, fallback positions and extra-household environmental parameters, and/or (3) in terms of feminist, institutionalist and
interdisciplinary perspectives where socio-cultural norms, lack of information, different perceptions of intra-household power, local and national
environments, etc., determine the actual allocation of household resources.
Excellent reviews and critiques of this literature are available in Nancy
Feminist Economics 5(2), 1999, 61–78
1354–5701 © IAFFE 1999
Downloaded by [115.85.25.194] at 19:33 24 March 2014
AR TICLES
Folbre (1995, 1997), Bina Agarwal (1997), Lawrence Haddad, John Hoddinott, and Harold Alderman (1997), Elizabeth Katz (1997), and Amartya
Sen (1990a).
This paper adds to this literature by formulating a purely neoclassical
intra-household model with a standard assumption of individual self-interest. The paper focuses on an important institutional aspect in some societies
where the marriage markets carry a high penalty for divorce and the fallback position outside of marriage is very low. The high cost of divorce
creates the possibility that one partner (the husband) may wield monopoly
power over another (the wife) because of socially determined gender-based
division of labor that allows the husband access to more lucrative occupations. This allows the model to focus on threats within marriage rather
than on the threats of exit from marriage. The monopoly power of one
partner makes the unequal allocation not only “unjust” but also inefŽ cient
by the usual neoclassical criteria. The model conceptualizes the idea of
intra-household terms of trade which is used to explain why, in some cases,
a woman’s work may be perceived as less important. It also alerts us to the
possibility that overall economic growth, if accompanied by a continuation
of this monopoly, may sometimes lead to a decline in women’s welfare. This
Ž nding lends further support to the idea of policy targeting within the
household.
2. INTRA- HOUSEHOLD RESOURCE
ALLOCATION, ECONOMI C GROWTH, AND
WOMEN’S WELFARE
In order to explore the asymmetric nature of intra-household resource
distribution, one can Žrst turn to the “unitary” model of the household of
Gary Becker (1981). The household allocation is unequal in this model if
the husband attaches unequal weights (lacks both “love” and “care” for the
wife) to his own welfare and the welfare of his wife.1 Even though the economists in this tradition do not emphasize male biases in the preferences
themselves, socio-culturally constructed biases will readily produce gender
asymmetry in these models. Since it is difŽ cult to alter preferences in the
unitary model, the policy-maker has limited instruments to correct asymmetric intra-household allocations. Moreover, unequal resource distribution within the household need not be inefŽ cient by the neoclassical
criteria and a policy intervention may not be justiŽ ed. Another implication
of the Becker model is that economic growth, in the form of higher real
income of the household, will necessarily improve the welfare of both partners unless the altruism parameters change exogenously. This contradicts
the view that economic growth in some cases may lead to a deterioration in
women’s welfare.2
Departures from these unitary models were Ž rst made by Marilyn Manser
62
PAT RIA RCHAL MONOPOL Y A ND ECONOMI C DEVELOPMENT
and Murray Brown (1980) and Marjorie McElroy and Mary Horney (1981)
who developed bargaining models of intra-household resource allocation.3
These models typically consider the following maximization problem:
Downloaded by [115.85.25.194] at 19:33 24 March 2014
max Z = Z(U(L1, T1), V(L1, T1)), subject to U(L1, T1) $ F f, V(L1, T1) $ F
m
(2.1)
where Z is a bargaining function increasing in both its arguments, L1 is the
husband’s leisure, T1 is the wife’s leisure, U is the wife’s utility function, V
is the husband’s utility function, F f and F m are the respective threat points
of the wife and the husband. If the resource allocation within marriage
yields her a utility level less than F f, the wife will have an incentive to terminate the marriage.
Several observations can be made about the class of models represented
by (2.1). First, similar to the unitary model, altruism still (partially) determines the resource allocation within the household.4 But a major burden
of explanation for asymmetric resource allocation now falls on the extraenvironmental parameters F f and F m. The extra-environmental parameters depend on the unearned income of the partners, their market
opportunities, conditions in the marriage markets, property rights, etc.
Some of these extra-environmental parameters are gender-speciŽc, and all
are determined outside the household.5 In most cases, the members of the
household can negotiate to reach a Pareto-efŽcient cooperative solution.6
In such cases, as in the unitary models, policy intervention may not be justiŽ ed based solely on the efŽ ciency considerations of neoclassical economics.
Second, these bargaining models assume voluntary participation of the
members in the marriage market and are based on the customs of Western
societies. The woman’s threat point always includes her choice of being
single. In most non-Western societies where arranged marriages and
various other social pressures exist, marriage markets are imperfect and a
threat of divorce may not be credible for the woman.7
Third, the bargaining models generally assume that transfers between
the spouses within marriage, if any, are predetermined in the marriage
market (possibly through costless and binding prenuptial agreements).8
But in imperfect marriage markets, if such agreements are costly and difŽ cult to enforce, and if the marriage contract is full of uncertainty,
ambiguity, and lack of information, it is possible to argue that an implicit
market for transfers may develop between the husband and the wife during
their married lives.
Fourth, the household-good implicit in (2.1) is assumed to be produced
jointly by the spouses. This is hardly appropriate in many societies. Overwhelming evidence from the less-developed countries shows that although
one can conceptualize a Gronau-type household commodity as a variant of
a nonrival public good which is jointly consumed, it is not jointly produced
in the sense of the Gronau model. The husband’s input and the wife’s input
in the production of this household good are imperfect substitutes. Many
63
Downloaded by [115.85.25.194] at 19:33 24 March 2014
AR TICLES
observers have noted that men and women from the same household
engage in different patterns of work. This is particularly true in Africa, Asia,
and Latin America.
Fifth, the literature treats the household goods as public goods consumed
jointly by the partners. But in reality not all household-produced goods are
jointly consumed. In poor countries, for example, the husband may have
claim over higher quality food and such other excludable commodities.
Finally, the class of models represented by (2.1) generally imply that if
the husband’s wage rises, the wife’s utility does not fall (and vice versa), i.e.,
dV/dWf and dU/dWm cannot be negative (where Wf is the market wage of
the wife, and Wm is the market wage of the husband). Unless the extrahousehold environmental parameters change during the process of economic development, an increase in family income in general does not hurt
women. Thus the unitary model and most bargaining models lead to the
conclusion that a higher household income generally increases a woman’s
welfare. This contradicts the views of those who think that economic growth
under certain conditions leads to a decline in women’s welfare.
The rent-seeking model developed below addresses these issues by combining the elements of the separate spheres bargaining model of Lundberg
and Pollak (1993) who focus on the bargaining within marriage, and the
spousal labor market model of Shoshana Grossbard-Shechtman (1993)
where the spouses sell labor to each other. An important message of the
model in Section 3 is that an intra-household production relation that gives one
partner (the husband) a monopoly of access to important resources may
lead to rent-seeking and may lead to female marginalization (deŽ ned as loss
of her utility) as economic growth takes place. The model shows that an
often-used government policy to subsidize household production (which
does not alter the relative welfare of the partners in unitary or bargaining
models) may paradoxically turn the intra-household terms of trade against
the wife and reduce her welfare. The rent-seeking approach connects the
intra-household economics to the well-developed literature in public
choice and international trade where rent-seeking societies, coalitions,
organizations, and Ž rms are shown to create deadweight losses and inefŽ ciencies that retard growth.9 As Folbre (1995, 1997) argues, the rentseeking analysis can be extended to include gender-based coalitions in a
society. Male collective action may lead to the “development of social institutions that give men important economic advantages in control over property, income and labor.” The model below provides a preliminary
micro-foundation for this approach.
If female marginalization is a consequence of a particular characteristic of
the husband’s utility function or the society’s cultural values, the tautology
offers little prospect of intervention. But if female marginalization is caused
by monopoly-induced inefŽciencies, the policies that remove these monopoly
rents can be supported more easily by well-known neoclassical criteria.10
64
PAT RIA RCHAL MONOPOL Y A ND ECONOMI C DEVELOPMENT
Downloaded by [115.85.25.194] at 19:33 24 March 2014
3.
A MODEL OF PATRIARCHAL MONOPOL Y
In the stylized model that follows, it is assumed that there are only two
decision-making members in the household: the husband and the wife. A
patriarchal monopoly11 is deŽ ned as a system where the following conditions
hold within a household: (1) the wife has no access to the market in the
sense that she cannot work in the market for wages, and must remain a
housewife to produce household goods; (2) there is an exit barrier in the
marriage market, i.e., no divorce is allowed; (3) the husband successfully
extracts rent from his wife: although the household good is jointly consumed, the wife must provide additional services (deŽ ned as the patriarchal
good) for the exclusive consumption of the husband. These assumptions are
made to keep the model simple and analytically tractable. In Section 4
below, I suggest some possible extensions of the model to capture more
realistic situations.
The existence of the patriarchal good gives rise to an implicit intra-household terms of trade, the value of which is the single most important indicator
of the extent of patriarchal monopoly in that household. In conventional
neoclassical models of home production, the assumption of joint production of the household good and the Beckerian idea of an altruistic dictator
who uses a group preference function precludes the possibility of existence
of a terms of trade between the husband and the wife.12 The bargaining
models (e.g., in McElroy and Horney 1981), on the other hand, are based
on voluntary contributions of the partners to produce the common household good. Since there is no intra-household market, the terms of trade is
not deŽ ned in these models either.
The model
First, consider Margaret Mead’s version of a home where “the men bring
the food, and women prepare it” (Sen 1990a: 139). Assume that the home
good is produced by the wife alone. The market-purchased home-good
input (such as grains, cooking oil and fuel) is supplied exclusively by the
husband. The wife merely “buys” this from him at an implicit price determined within the household. Notice that given these socially determined
gender roles, the housewife has no access to the market and must depend
entirely on the husband for the supply of inputs for the home-good production. The production function of the home good is therefore simply
H = H(K); dH/dK > 0, d2H/dK 2 < 0
(3.1)
where H is the home good to be produced, and K is the input used to
produce the home good. For simplicity it is further assumed that neither
the husband nor the wife spends any working time to produce the home
good. This departure from the conventional household models is made to
65
AR TICLES
keep the algebra as simple as possible. The model can easily be extended
to include the wife’s home production time.13
The patriarchal arrangement of intra-household relation is such that the
husband implicitly sells K to the wife in return for the patriarchal good
deŽ ned as p . The good p may represent the special efforts that the wife must
make to please the husband14 and may include the preparation of superior
and special meals for him, knitting, mending, and laundering his clothes,
or any other exclusive services for the husband. For simplicity, it is assumed
that the production function of p is a function of Tp , which is the labor
input of the wife.15
Downloaded by [115.85.25.194] at 19:33 24 March 2014
p = p (Tp ) ;
Tp
(3.2)
Assume that the wife has a total time endowment of 1 and she enjoys the
rest of her time T1 as leisure:
T1 + Tp = 1
(3.3)
The implicit balance of trade between the husband and his wife must obey
the condition
Pk* K = p
(3.4)
Pk*
is the price of K that the wife must pay, and it can also be interpreted as
the intra-family terms of trade. The price of the patriarchal good (also equal
to the shadow price of the wife’s time from (3.2) and (3.4)) has been used
as the numeraire. The wife’s utility depends on the amount of her leisure
time and on the amount of the home good she produces for herself and
the family. Denoting her utility16 by U and letting subscripts i and j denote
the partial derivatives
U = U(H, T1); U $ F
f
Ui > 0, Uii < 0, Uij > 0, i, j = 1, 2; i Þ j
(3.5)
Turning now to the husband, assume that his supply of wage-labor is Ž xed.
Again, this assumption is made to simplify the algebra and can be relaxed
easily.17 Once again, assume that the total labor endowment of the husband
is 1.
L1 + L2 = 1
(3.6)
The husband works in the market for L2 periods of time and earns wages
equal to Wm per period. His leisure is given by L1. His total wage earning is
WmL2. He has the choice of spending part of his wages to buy a market
good, M, at a price Pm and the other part to buy the input (K) for the home
good that he supplies as a provider under the patriarchal system. Notice
that M is an exclusive property of the husband and is not a part of the home
good.
If market price of K is Pk, the husband’s budget constraint becomes
(assume that the household does not save):
66
PAT RIA RCHAL MONOPOL Y A ND ECONOMI C DEVELOPMENT
WmL2 = PkK + PmM
(3.7)
In keeping with the household models in the literature, it is assumed that
H and M are perfect substitutes in consumption for the husband.18
The utility function of the husband, V, can now be speciŽ ed as a positive
function of the home and market goods, the patriarchal commodity p , and
his constant endowment of leisure L1.19
V = V(H + M, p , L1); V $ F
m
Vi > 0, Vii < 0, Vij > 0; i, j = 1, 2, 3; i Þ j (3.8)
Downloaded by [115.85.25.194] at 19:33 24 March 2014
There is no altruism in this model. However, since H is a common household good, the husband’s utility goes up if the wife’s utility rises as a result
of a rise in H.
Patriarchal rent
Note that from (3.7), the husband purchases K at the market price Pk, but
from (3.4) sells it to his wife at Pk*. Although Pk* is not observable directly,
there is a rent, Rm, that accrues to the husband under the patriarchal
arrangement of production, since the wife cannot directly purchase K.
Rm = Pk* – Pk
(3.9)
Conceptually, this is similar to an import tariff imposed by a successful lobby
of domestic producers that generates rent in the import-competing industry. Since the price is more than the “true” marginal cost, standard monopoly-based inefŽciency is generated. In view of the patriarchal rent, (3.7)
can now be modiŽ ed to write the husband’s “full income” as
WmL2 + RmK = p + PmM + WmL1
(3.79 )
The wife maximizes (3.5) with respect to K, and subject to (3.1)–(3.4). This
yields
­ U/­ T1 = (­ U/­ H)Hk/Pk*
(3.10)
where Hk ; ­ H/­ K.
Equation (3.10) shows the wife’s demand for K. She equates her marginal
utility of leisure (divided by her price of labor, which is 1 from (3.2) and
(3.4)) to the utility-equivalent of one dollar’s worth of K. The husband has
only one choice variable in this model: he can allocate his total resources
between the household (purchase K) and the market (purchase M). This
is equivalent to saying that he can determine his rent Rm, since K and Rm
are uniquely related from (3.4), (3.9), and (3.10). Thus the husband maximizes (3.8) with respect to the patriarchal rent, Rm, subject to (3.2), (3.4),
(3.79 ), and (3.10). This is a simple optimization process and yields the
following result:
Rm = –h (V1/V2)« f/(« f + 1)
67
(3.11)
AR TICLES
where V1 ;
­ V/­ (H + M); V2 ;
h ;
and
«
f
;
­ V/­ p ;
[Hk – Pk/Pm]
[Pk*/K]dK/dPk*
(3.12)
<0
Downloaded by [115.85.25.194] at 19:33 24 March 2014
dK/dPk* < 0
(3.13)
(3.14)
where « f is the elasticity of the wife’s demand for K and h is an indicator of
the husband’s net beneŽ t of purchasing K (see below).
Equation (3.11) shows the Ž rst-order condition for a maximum. It shows
that h and (« f + 1) must have the same sign for an interior solution to exist.
To see this, rewrite h V1/V2 as Pk/V2(V1Hk/Pk – V1/Pm). Purchase of K gives
the husband utility worth V1Hk/Pk per dollar, and purchase of M yields
utility worth V1/Pm per dollar. (V1Hk/Pk – V1/Pm) thus shows the net beneŽ t
of purchasing K, rather than M. Now if the wife’s demand for K is inelastic,
i.e., if (« f + 1) > 0, the husband is able to increase his rent (and his full
income from (3.79 )) by reducing the supply of K. However, if h is positive
(V1Hk/Pk > V1/Pm), other things equal, he would purchase more K to equalize his utility per dollar of K and M. Thus he faces a tradeoff: as his increase
in rent from a reduction in K is offset by a decrease in net beneŽ t from the
consumption of H. The argument holds in reverse if h < 0 and (« f + 1) < 0.
If h and « f + 1 are of opposite signs, this tradeoff does not exist and thus
there will be no interior solution. An interior solution is assumed to exist
for this model. Consequently, utilizing the sign of (3.13), Rm is always positive. Note that if h = « f + 1 = 0, Rm is indeterminate. This indeterminacy
stems from the standard case where the monopoly price is indeterminate if
the demand is unitary elastic. But in this model, unlike the standard
monopoly result, an interior solution exists even if demand is inelastic.20
Now, totally differentiating (3.11), and using (3.1)–(3.10), and the secondorder condition for a maximum, it can be shown that dRm/dWm > 0 if
h >0
and (« f + 1) > 0
(3.15)
If (3.15) holds, an increase in husband’s income will increase the patriarchal rent, diminish the intra-household value of the woman’s contribution
(the woman’s terms of trade: 1/Pk*), reduce K, and therefore reduce the
production and consumption of the household good. However, if h < 0 and
(« f + 1) < 0, an increase in his income will beneŽ t both the partners. The
intuition behind (3.15) is as follows. If the wife’s demand for K is inelastic,
the husband would like to increase his rent, but cannot do so indeŽ nitely
because this also reduces H. An extra dollar of wage-income now permits
the husband to reduce the supply of K further: the loss of his utility from a
lower level of H is now more than compensated on the margin because the
extra dollar now allows him to purchase more M. Differentiating and using
(3.3), (3.4), (3.5), and (3.13) it can be shown that
68
PAT RIA RCHAL MONOPOL Y A ND ECONOMI C DEVELOPMENT
Downloaded by [115.85.25.194] at 19:33 24 March 2014
dU/dWm < 0, dV/dWm > 0, dT1/dWm < 0, dTp /dWm > 0, dp /dWm > 0 (3.16)
if (3.15) is satisŽ ed.
To reiterate, (3.16) states that economic growth may make the husband
better off and the wife worse off. If growth takes the form of higher wages
of the husband, it will increase the wife’s workload, decrease her welfare,
and decrease the value of the wife’s contribution to the family if the conditions in (3.15) are met. Notice that a market subsidy on food or fuel
(lower Pk) will actually increase the likelihood of female marginalization
(fall in U) and move the intra-household terms of trade against the wife. If
K is subsidized in the market, h rises and this makes female marginalization
more likely. The same is true when improvements in household production
technology (that increases Hk) occur. Female marginalization is thus an
effect of the monopsonistic production relation rather than the technical
inefŽ ciency of the home production process. In many LDCs the prices of
essential commodities are sometimes subsidized (Pk is reduced) as a policy
to support the weaker sections of the population. The analysis above suggests that if such inputs are under the domain of the husband, a subsidy
policy may in fact be counterproductive and reduce women’s welfare.21
A comparison can now be made between this model and other models
in the literature. The rent-seeking model is close in spirit to the separate
spheres model of Lundberg and Pollak (see Section 4). As discussed earlier,
the main difference between the rent-seeking model and the other models
is that, unlike the other models, the rent-seeking model considers an intrahousehold market. In a traditional Nash-bargaining game, a woman cannot
gain power if the divorce costs are prohibitively high, and the woman’s fallback position is unchanged. But in the rent-seeking model, a woman’s
power (terms of trade and utility) depends on the extent of patriarchal
monopoly, which depends not only on the husband’s wage, but also on the
price of the product that belongs to the husband’s domain (Pk). In Nashbargaining models, a rise in the husband’s wage or a drop in market prices
is likely to raise the wife’s utility (Ravi Kanbur and Lawrence Haddad 1994).
The same is true in unitary models. In the general theory of marriage proposed by Grossbard-Shechtman (1993), the wife’s quasi-wage for spousal
labor will also increase if the husband’s wage increases.22
As far as female marginalization (fall in U) is concerned, the existing
models thus appear as a special case of the rent-seeking model above (i.e.,
when (3.15) does not hold). But if the wife predominantly consumes the
home good, has no market access to buy substitutes of H, and has a very
low threat-point, assuming that leisure and home goods are not good substitutes, it is not unreasonable to expect that her derived demand for K will
indeed be inelastic and the condition (3.15) will hold.23
An important contribution of this model to the literature is the concept
of a patriarchal good. This concept does not exist in the unitary and
69
Downloaded by [115.85.25.194] at 19:33 24 March 2014
AR TICLES
bargaining models where the partners consume private goods and jointly
produced household goods (the household public good production
depends on the voluntary contributions of the members). But as long as
the wife produces exclusive services for the husband, a patriarchal commodity exists, and therefore an intra-household market exists.24 Given the
husband’s monopoly of access, rent-seeking is likely and conditions for
female marginalization can be derived.
For a less-developed country, an empirical test of this theory can be
carried out if we are able to Ž nd a suitable proxy for H. Good H may include
general cleanliness, family health and staples designated for common
household consumption.25 Thus, in the model above, a higher value of H
will most probably improve the nutritional and health status of a woman in
a poor household. Since the data on various nutritional indicators (such as
height/weight ratio, anemia, protein deŽ ciency) as well as wage, are more
easily available, the following empirical hypothesis can be tested:
In households where women are housewives and have no source of
unearned income, a rise in the husband’s wage or a subsidy on the
goods that fall under the husband’s exclusive domain would not
necessarily increase the nutritional and health status of women and
in fact it may lead to their absolute deterioration.
Contrary to Kanbur and Haddad’s (1994) hypothesis, women may be
more impoverished in “better-off” households!
4.
E XTENSIONS OF THE MODE L
The assumption of no job market access of the wife makes this model analytically tractable, but probably makes it unsuitable for a large number of
households where women do work. This section suggests four possible
extensions of the basic model.
Suppose the assumption of the husband’s pure monopsony is relaxed,
and the wife is allowed to work in the market for wages, but we still maintain
the assumption of high cost of divorce.26 Consider Ž rst the case where the
wife earns wages (Wf) in the labor market, but has no control over her wages:
she must transfer all her wages to her husband due to social norms, or
gender-speciŽ c environmental parameters that force her to relinquish her
share of wages to the husband.27 This situation is also similar to the case
where the marriage market (and consequent implicit prenuptial agreement) is so unfavorable to the women that dowry is not adequate to cover
all equilibrium transfers to the husband. The wife must therefore transfer
all her income to him during the period of marriage. To explore the implications of this household, one can modify the model of the last section to
include the wife’s time worked for wages (T2). The husband’s full income
will now include WfT2 and he will use T2 as his choice variable in his
70
Downloaded by [115.85.25.194] at 19:33 24 March 2014
PAT RIA RCHAL MONOPOL Y A ND ECONOMI C DEVELOPMENT
optimization exercise.28 The basic idea of patriarchal monopoly will still be
retained; and essentially the same conclusions can be derived with a marginalization condition similar to (3.15).
Second, assume that the wife earns wages and can purchase K at price Pk,
without any interference from the husband. The husband will not be able
to wield any monopsony power in this case and he cannot seek rent.
Suppose, however, the wife’s total wages are low such that she always
reaches a corner solution, i.e., even if she spends her entire income on K,
she can only purchase K1 units of K, which is less than Kmin, the minimum
K required for her survival. In this case the husband will still have a monopsony power and rent-seeking ability, although diminished by the size of K1.
Third, consider the case of an altruistic husband. If his wife’s leisure
enters his utility function (see (2.1)), he will now face a negative effect of
his higher rent that reduces her leisure (see (3.16)). Introduction of weak
altruism will make the model more complex but will not damage the major
results of the model. Presence of strong altruism, however, will offset the
effects of rent-seeking, and if altruism is strong enough the rent may indeed
be negative. The conventional models implicitly assume that the husband’s
altruism is strong enough to offset his rent-seeking motive. The underlying
possibility of patriarchal monopoly is thus ignored. Note that in an
“efŽ ciency wage” framework, but without altruism, if a woman’s productivity in the production of the patriarchal good p depends on her consumption of the home good H, a high rent may reduce p , and hence it will
also reduce the husband’s utility. The husband may appear to be an altruist and he will reduce rent if this efŽ ciency-wage hypothesis holds.
Finally, consider a case where both the partners are in a position to
provide market-purchased inputs into the home-good sector with full proprietary rights to their own wages. A model similar to a bilateral monopoly
can be conceptualized if we assume that both the husband and the wife have
their own “separate spheres.” This is close to the model of Lundberg and
Pollak (1993) with high divorce costs.29 But our rent-seeking model
enhances their separate spheres model by introducing a market for spousal
goods (goods produced exclusively by one spouse for another).30 Unlike
the case in the last section, we can now assume that the home good is jointly
produced by the husband and the wife with two market-purchased inputs,
one provided by the wife and the other provided by the husband. I have
developed this model elsewhere (Purkayastha 1997) and shown that (1)
both partners will now seek rent and, similar to Section 3, a spousal terms
of trade can be deŽ ned; (2) a noncooperative Nash game will yield positive
or negative values of spousal rents depending on demand elasticities and
the home-good productivities; (3) similar to Section 3, a condition for
female marginalization can be derived; and (4) the existence of the bilateral monopoly will be inefŽ cient in the sense that a combination of positive and/or negative rents may exist between the partners even if they
71
AR TICLES
negotiate to improve mutual welfare from the Nash equilibrium point. This
feature distinguishes the rent-seeking model from bargaining models.31
Downloaded by [115.85.25.194] at 19:33 24 March 2014
5.
CONCLUDING COMMENTS
In many societies women’s work, especially household work, is perceived as
“less important.” While there may be many social and anthropological
reasons behind this perception, this paper has attempted to show that in
the context of a pure neoclassical model, one can conceptualize an intrahousehold terms of trade, which, if unfavorable to the wife, may reduce the
intra-household economic value of her work.32 This may lead to the perception that her work is less important. The stylized model of pure monopsony of the husband can be extended in various ways as discussed in the last
section and is a subject of further research.
The model developed in this paper is consistent with an “inverted U
hypothesis” where intra-household inequality increases with the growth of
the husband’s income, especially if the women are housewives. Subsequent
entry of women into the paid workforce is likely to reduce intra-household
inequality. This is consistent with the experience of many Western societies
where the status of women considerably improved after they joined the
workforce. The model provides at least one explanation why the women in
Africa, who predominantly engage in market-based work, have lower relative mortality rates (and possibly higher status) compared to their counterparts in South Asia and the Middle East.33 Since land ownership will be
closely correlated with income, the model lends support to the hypothesis
that a public policy that encourages female land ownership will increase
women’s welfare.34
Although the rent-seeking model provides signiŽ cant insights, some
shortcomings of this model should also be noted. (1) A static framework of
this sort ignores aspects of fertility and sexuality that many authors consider
to be very important variables underlying women’s welfare. A dynamic
model that includes reproductive decisions can be a subject of further
research.35 However, insofar as an asymmetric distribution of power exists,
inclusion of the fertility variable is unlikely to change the basic conclusions
of this paper. (2) The model presented here considers the case of a nuclear
family. Decision-making in the context of an extended or joint family has
not been considered. In many societies the fathers-in-law, mothers-in-law,
or the husbands’ elder brothers may actually have decision-making powers.
These important complications have been ignored in this paper. (3) The
model does not explain the historical reason why and how the production
relations have created male access to resources, or why economic growth
may increase men’s wage relative to the women’s wage.
Asymmetric allocation of household resources, female marginalization,
and its relation to patriarchy is a complex phenomenon. By deŽ nition, a
72
PAT RIA RCHAL MONOPOL Y A ND ECONOMI C DEVELOPMENT
neoclassical monopsonist is only able to manipulate prices for proŽ t. But
within a real household, myriad other nonprice instruments may be used
to allocate resources, and market power may not always translate to power
within the household. Nevertheless, the use of a rent-seeking model provides an important tool to understand intra-household allocation within a
purely neoclassical framework.
Downloaded by [115.85.25.194] at 19:33 24 March 2014
Dipankar Purkayastha, Department of Economics, California State University,
800 N. State College Blvd., Fullerton, CA 92834-6848, USA
e-mail: [email protected]
ACKNOWLEDGMENTS
I would like to thank Pinaki Bose, Eleanor Brown, Andrew Gill, Robert
Michaels, Bhuvana Rao, Diana Strassmann, David Wong, two anonymous
referees, and the participants in a CSUF departmental seminar and an AEA
conference, for their extremely useful comments. Extensive and insightful
comments by Nancy Folbre substantially improved the quality of the paper.
I would like to thank her for her suggestions. All remaining errors are my
responsibility.
NOTES
1
2
3
4
If his indifference curve (deŽ ned over his own consumption and over his wife’s
consumption) is not symmetric along a 45° line.
Ester Boserup’s (1970) classic observation that the onset of agricultural growth
and the switch from hoe- to plough-based cultivation actually “marginalized”
women, is a case in point. Authors such as Amartya Sen (1987, 1990b), Jean Drèze
and Amartya Sen (1995), Peter Svedberg (1990), Ivy Papps (1992) and Agarwal
(1994) explore the relations between market conditions, female labor-force participation rate, the role of the state, property rights and women’s welfare. Some
authors have argued that as a society passes through the early and middle phases
of industrialization, a “mutual accommodation between capitalism and patriarchy” takes place which “marginalize,” “casualize,” “tertiarize” and often displace women from the labor force (Alison Scott 1986). Clarita Lantican,
Christina Gladwin, and James Seale (1996) provide a review of this literature.
Drèze and Sen (1995: 159) argue that “economic progress on its own does not
necessarily do very much to reduce gender inequalities,” and Ž nd evidence that
economic growth may lead to “some intensiŽ cation of gender bias.”
See Shelly Lundberg and Robert Pollak (1997) for a survey. Jane Leuthold
(1968) provides an analysis with egoistic agents. Peter Kooreman and Arie
Kapteyn (1990) survey the literature and use equations similar to (2.1). Lundberg and Pollak (1993) offer an alternative viewpoint. The model in the next
section does not incorporate the wife’s leisure in the husband’s utility function.
The results of this paper will be less robust if this variable is included in the
husband’s utility function; and a more stringent condition must be derived to
demonstrate the condition for female marginalization.
The equilibrium of the model depends on how “egoistic” or how “altruistic” the
73
AR TICLES
5
6
7
Downloaded by [115.85.25.194] at 19:33 24 March 2014
8
9
10
11
12
13
14
15
partners are in their “felicity functions.” McElroy and Horney (1981) Ž nd conditions that show “selŽ shness” and “altruism” embedded in the utility functions.
They deŽ ne paternalism (maternalism) as the case where he (she) regards one
of the goods in his (her) utility function as a merit good, while the spouse does
not.
See McElroy (1990), Folbre (1997), and Katz (1997).
The noncooperative frameworks of Lundberg and Pollak (1993), Katz (1997),
and others, are exceptions.
More speciŽ cally, her divorce costs are so high or her utility as a single woman
is so low that her threat-point never appears as a binding constraint. Dorothy
Stein (1989) argues that marriage is the “only approved status for women” in
many LDCs.
Lundberg and Pollak (1993) consider a model where such agreements are costly
and nonbinding.
Mancur Olson’s (1982) classic work shows that the dominance of rent-seeking
distributional coalitions is the primary reason behind a nation’s stagnation and
decline. In international trade theory the monopoly power of a country or a Ž rm
is shown to be inefŽ cient because it reduces world welfare (Neil Vousden 1990).
Neoclassical trade and welfare theory advocates tariff-free trade to dissipate these
monopoly rents ( James Melvin and Robert Warne 1973).
Haddad and Kanbur (1990) explore the policy implications of a neglect of intrahousehold inequality. Pierre Chiappori, Lawrence Haddad, John Hoddinott, and
Ravi Kanbur (1992) and Lawrence Haddad, John Hoddinott, and Harold Alderman (1997) provide excellent surveys of theoretical and empirical issues in this
area.
Obviously, the term “patriarchy” is used rather loosely in this paper. Conditions
(1)–(3) are not sufŽ cient (and may not even be necessary) to describe what is
commonly known as “patriarchy” in sociological, anthropological, and feminist
literature. The focus of this paper is on intra-household monopoly and rentseeking and not patriarchy per se (although in many cases rent-seeking may be an
outcome of patriarchal relations).
In Becker’s model, the marriage markets “assign” altruists to their beneŽ ciaries.
Given an optimal altruist–beneŽ ciary pair, the terms of trade between them is
undeŽ ned since all beneŽ ciaries must “voluntarily maximize family income and
utility of the altruist, even when he (e.g., the altruist) does not have dictatorial
power over their (e.g., the beneŽ ciaries) decisions, because their own utility
increases along with his” (Becker 1981: 191). The distribution of family income
is thus irrelevant in Becker’s model.
See Purkayastha (1997).
This is similar to the concept of spousal labor in Shoshana Grossbard-Shechtman
(1993). It is important to note that H and p are not perfect substitutes for the
husband. Good H has a public-good character but the consumption of p is
excludable. Good H, which is a composite home good, may include “clean home”
or “child-rearing” which both partners may enjoy; but good p may include,
among other things, high-quality food which may only be claimed by the
husband. In the Chinese context, for example, Xiyan Zhao (1992) shows that
women typically consume inferior-quality food and leave the high-protein items
(pork, chicken, and eggs) for their husbands and the children. A woman in a
poor household is usually the last person to eat: by the time her turn comes, there
may not be enough food left and she may go to bed hungry (Zhao 1992; Barbara
Harriss 1990).
In a more general model, p would be a function of Tp and K.
74
PAT RIA RCHAL MONOPOL Y A ND ECONOMI C DEVELOPMENT
16
17
18
19
Downloaded by [115.85.25.194] at 19:33 24 March 2014
20
Assume that F f is low such that the constraint U $ F f is not binding. If this constraint is in fact binding, the husband can charge only a maximum rent in (3.11)
below to avoid marital disruption. This maximum will be a negative function of
her threat point. If her threat point is high enough, rent-seeking by the husband
may not occur. Note that if the wife has independent access to her own wealth
or income, she can purchase K directly from the market and need not depend
on her husband for its supply. This will also raise F f.
See Purkayastha (1997).
This assumption is made by Reuben Gronau (1977), Eric Solberg and David
Wong (1992) and many other authors.
Once again assume that the constraint V $ F m is not binding.
Note that from (3.14), since,
dK/dPk* = (Pk* U22K – HkU12K – U2)/(Pk*U21Hk – (Pk*)2U22
– U1Hkk – Hk2U11 + Pk*HkU12) < 0
21
22
23
24
25
26
the wife’s demand curve for K is always downward sloping.
See Bhuvana Rao (1995) for an ethnographic study along these lines.
In the Nash-bargaining models, if the wife’s threat point is very low, the household will behave as if it is maximizing the dictatorial husband’s utility (Zhao
1992). In our model, a high cost of divorce for the wife opens the possibility of
rent-seeking by the husband. This is consistent with Grossbard-Shechtman.
Although she acknowledges the possibility that rent-seeking may exist, in her
model (Chapter 10) the rent depends on the difference between the marriagespeciŽ c quasi-wage (which is based on the husband’s feelings toward the wife)
and the market-determined quasi-wage. To compare her model with ours, deŽ ne
the wife’s effective quasi-wage as H/Tp . It can be shown that d(H/Tp )/dWm may
be positive only if (3.15) does not hold. There is no joint consumption good in
Grossbard-Shechtman’s model. The wife’s demand for H (and hence K) thus
plays no role. The absence of joint consumption in her model precludes the
possibility of female marginalization as male wage rises.
In Grossbard-Shechtman’s model, a rise in the husband’s wage raises the demand
for spousal labor. In the rent-seeking model a rise in the husband’s wage raises
the supply of spousal labor if (3.16) holds. In an extended version of the model,
the wife’s labor used in the production of H, deŽ ned as Th, also increases conditionally (Purkayastha 1997).
Even if both the partners consume only the common household goods, he may
prefer a subset of the public goods and she may prefer another subset of the
public goods. If she produces the public goods primarily desired by him, part of
the so-called public good really assumes the character of a patriarchal good.
Good H can also be a proxy for child care. Under this interpretation the model
shows an important relation between male wage and children’s welfare.
In many LDCs, a signiŽ cant number of women do not work for wages. The laborforce participation rates are low for the Middle Eastern countries, but high for
sub-Saharan Africa (United Nations 1994a). Labor-force participation is often
limited by a lack of employment opportunities and sometimes due to a lack of
women’s human capital including health and education (see United Nations
1994b: Tables 9 and 11). S. Pothen (1989) analyzes the religious and cultural barriers to divorce. Dowry, given by the bride’s family to the groom’s family during
marriage, cannot be taken back if the marriage breaks down. Cost of divorce,
therefore, is very high for the women. A high fertility rate and the relative stability of marriage may be two aspects of the same process. In the case of the United
States it has been shown that the two are positively correlated, especially if the
75
AR TICLES
Downloaded by [115.85.25.194] at 19:33 24 March 2014
27
28
29
30
31
32
33
34
35
children are young (Lee Lillard and Linda Waite 1993). The population
distribution in the LDCs is heavily biased in favor of children. In the LDCs, high
fertility itself thus may suggest that the probability of divorce is very small. Social
security programs (such as AFDC in the U.S.) are nonexistent in almost all LDCs.
In addition, sometimes there are legal hurdles to divorce (Erika Platte 1989).
Crude divorce rates are thus extremely low in most LDCs (United Nations 1994b).
Crude divorce rates underestimate the incidence of divorce in the LDCs because
of the presence of a large number of children in the population. There are also
“unofŽ cial” divorces where the courts do not get involved. However, the differences in divorce rates between the LDCs and the industrial countries are still very
signiŽ cant.
Meera Chatterjee (1990: 32) discusses a case where “In general, men tend to
control decisions on the use of all household income, including women’s wages.”
Folbre (1997: 267) argues that gender-speciŽ c environmental parameters determine spousal control of income.
A parameter a (0 # a # 1) can be used to show the socially sanctioned part of her
income under her control.
See Katz (1997) for an excellent discussion on noncooperative models.
The spouses essentially sell labor to each other.
There will be no rent-seeking only if the partners do not sell goods to each other
but reach a Pareto-efŽ cient equilibrium through a Lindahl process.
See Sen (1990a).
See Sen (1990b).
See Agarwal (1994).
A well-known feature of patriarchal systems is preference for the male child. It has
been observed that in these societies the mothers often “voluntarily” participate in
discriminations (with respect to food and other goods) against their own daughters. Such discrimination can often lead to death of the female child. On the basis
of the rent-seeking model, one can speculate why women who are directly responsible for feeding the children may favor male children. If the woman has no market
access to K (Section 3), and only the male child is capable of providing her with K
in the future, it is to her advantage to prefer sons, so that, in the future, in a typical
joint family setup, the husband’s monopoly over K can be contested and replaced
by an oligopoly of the husband and the sons. If this oligopoly is noncollusive, she
beneŽ ts from it. This may explain the anthropological observation that a woman
gains power and prestige as she becomes the mother of many sons.
REFERE NCES
Agarwal, Bina. 1994. A Field of One’s Own: Gender and Land Rights in South Asia. Cambridge, U.K.: Cambridge University Press.
——. 1997. “ ‘Bargaining’ and Gender Relations: Within and Beyond the Household.” Feminist Economics 3(1): 1–51.
Becker, Gary. 1981. A Treatise on the Family. Cambridge, MA: Harvard University Press.
Boserup, Ester. 1970. Women’s Role in Economic Development. New York: St. Martin’s
Press.
Chatterjee, Meera. 1990. Indian Women: Their Health and Economic Productivity, World
Bank Discussion Paper No. 109. Washington, DC: World Bank.
Chiappori, Pierre-Andre, Lawrence Haddad, John Hoddinott, and Ravi Kanbur.
1992. “Unitary versus Collective Models of the Household: Time to Shift the
Burden of Proof,” paper presented at the American Economic Association Meetings, Anaheim, CA, January 5–7, 1992.
76
Downloaded by [115.85.25.194] at 19:33 24 March 2014
PAT RIA RCHAL MONOPOL Y A ND ECONOMI C DEVELOPMENT
Drèze, Jean and Amartya Sen. 1995. India: Economic Development and Social Opportunity. Delhi: Oxford University Press.
Folbre, Nancy. 1984. “Market Opportunities, Genetic Endowments and the
Intrafamily Resource Distribution: Comment.” American Economic Review 74:
518–20.
——. 1995. “Engendering Economics: New Perspectives on Women, Work, and
Demographic Change,” in Annual World Bank Conference on Development Economics
(Proceedings). Washington, DC: World Bank.
——. 1997. “Gender Coalitions: Extrafamily In uences on Intrafamily Inequality,”
in Lawrence Haddad, John Hoddinott, and Harold Alderman (eds.), Intrahousehold Resource Allocation in Developing Countries: Models, Methods, and Policy. Baltimore, MD: International Food Policy Research Institute and Johns Hopkins
University Press.
Gronau, Reuben. 1977. “Leisure, Home Production and Work – The Theory of the
Allocation of Time Revisited.” Journal of Political Economy 85(6): 1099–123.
Grossbard-Shechtman, Shoshana. 1993. On the Economics of Marriage: A Theory of Marriage, Labor, and Divorce. Boulder, CO: Westview Press.
Haddad, Lawrence and Ravi Kanbur. 1990. “How Serious is the Neglect of IntraHousehold Inequality?” Economic Journal 100: 866–81.
Haddad, Lawrence, John Hoddinott, and Harold Alderman (eds.). 1997. Intrahousehold Resource Allocation in Developing Countries. Baltimore, MD: Johns Hopkins
University Press.
Harriss, Barbara. 1990. “The Intrafamily Distribution of Hunger in South Asia,” in
Jean Dreze and Amartya Sen (eds.) The Political Economy of Hunger, Vol. 1. Oxford:
Clarendon Press.
Kanbur, Ravi and Lawrence Haddad. 1994. “Are Better Off Households More or
Less Unequal?” Oxford Economic Papers 46: 445–58.
Katz, Elizabeth. 1997. “The Intra-Household Economics of Voice and Exit.” Feminist Economics 3(3): 25–46.
Kooreman, Peter and Arie Kapteyn. 1990. “On the Empirical Implementation of
Some Game Theoretic Models of Household Labor Supply.” Journal of Human
Resources 25(4): 584–98.
Lantican, Clarita P., Christina H. Gladwin, and James Seale, Jr. 1996. “Income and
Gender Inequalities in Asia: Testing Alternative Theories of Development.” Economic Development and Cultural Change 44(2): 235–63.
Leuthold, Jane H. 1968. “An Empirical Study of Formula Income Transfer and the
Work Decision of the Poor.’” Journal of Human Resources 3(3): 312–23.
Lillard, Lee A. and Linda J. Waite. 1993. “A Joint Model of Marital Childbearing and
Marital Disruption.” Demography 30(4): 653–81.
Lundberg, Shelly and Robert A. Pollak. 1993. “Separate Spheres Bargaining and the
Marriage Market.” Journal of Political Economy 101(6): 988–1010.
—— and Robert A. Pollak. 1997. “Bargaining and Distribution in Marriage.” Journal
of Economic Perspectives 10(4): 139–58.
Manser, Marilyn and Murray Brown. 1980. “Marriage and Household DecisionMaking: A Bargaining Analysis.” International Economic Review 21(1): 31–44.
Melvin, James R. and Robert D. Warne. 1973. “Monopoly and the Theory of International Trade.” Journal of International Economics 3: 117–34.
McElroy, Marjorie B. 1990. “The Empirical Content of Nash-Bargained Household
Behavior.” Journal of Human Resources 25(4): 559–83.
—— and Mary J. Horney. 1981. “Nash-Bargained Household Decisions: Toward a
Generalization of the Theory of Demand.” International Economic Review 22(2):
333–49.
77
Downloaded by [115.85.25.194] at 19:33 24 March 2014
AR TICLES
Olson, Mancur. 1982. The Rise and Decline of Nations: Economic Growth, Stagation, and
Social Rigidities. New Haven, CT: Yale University Press.
Papps, Ivy. 1992. “Women, Work and Well-Being in the Middle East: An Outline of
the Relevant Literature.” Journal of Development Studies 28(4): 595–615.
Platte, Erika. 1988. “Divorce Trends and Patterns in China: Past and Present.” PaciŽc
Affairs 61(3): 428–45.
Pothen, S. 1989. “Divorce in Hindu Society.” Journal of Comparative Family Studies
20(3): 377–92.
Purkayastha, Dipankar. 1997. “Intrahousehold Rent-Seeking and Female Marginalization in the Less Developed Countries.” Working Paper, California State University, Fullerton, April.
Rao, Bhuvana. 1995. “Is She Ill Or Is She Not: Female Sexuality, Gender Ideologies,
and Women’s Health in Tehri Garhwal, North India,” unpublished Ph.D. dissertation submitted to the Department of Anthropology, Syracuse University.
Scott, Alison M. 1986. “Women and Industrialization: Examining the Female Marginalization Thesis.” Journal of Development Studies 22(4): 649–80.
Sen, Amartya. 1987. “Africa and India: What Do We Have to Learn from Each
Other?”, World Institute of Development Economics Research, Working Paper
19. Helsinki: WIDER.
——. 1990a. “Gender and Cooperative Con icts,” in Irene Tinker (ed.) Persistent
Inequalities: Women and World Development, pp. 123–49. New York: Oxford University Press.
——. 1990b. “More than 100 Million Women are Missing.” New York Review of Books,
(December 20): 61–6.
Solberg Eric and David Wong. 1992. “Family Time Use: Leisure, Home Production,
Market Work, and Work Related Travel.” Journal of Human Resources 27(3):
485–510.
Stein, Dorothy. 1988. “Burning Widows, Burning Brides, the Perils of Daughterhood
in India.” PaciŽc Affairs 61(3): 465–85.
Svedberg, Peter. 1990. “Undernutrition in Sub-Saharan Africa: Is There a Gender
Bias?” Journal of Development Studies 26(3): 469–86.
United Nations. 1994a. Human Development Report 1994. New York: Oxford University Press.
——. 1994b. 1992 Demographic Yearbook. New York: United Nations.
Vousden, Neil. 1990. The Economics of Trade Protection. Cambridge, U.K.: Cambridge
University Press.
Zhao, Xiyan. 1992. “Women’s Nutrition: Intrahousehold Allocations of Food,” in
Ismail Sirageldin and Robb Davis (eds.) Towards More EfŽcacy in Women’s Health
and Child Survival Strategies. Baltimore, MD: Johns Hopkins University Press.
78