Do Husbands and Wives Pool Their Resources?

Abstract

This paper replicates results of an article showing that families with children increased expenditures on women’s clothing (relative to men’s) after implementation of a policy that shifted a child subsidy “payment” from the father to the mother. These results were interpreted as evidence that families do not pool their income but allocate consumption based on income source. However, the current paper also finds an increase in relative spending on women’s clothing among childless couples, a sample the policy change did not impact. Alternative explanations are explored for observing these patterns, but none can rule out either bargaining or income pooling.