The Effect of the Great Recession on Women's Marital Bargaining Power

Mia Bird, University of California, Berkeley

This study examines the effect of recession-induced differential changes in men’s and women’s unemployment rates on the distribution of bargaining power within marriages. While marital bargaining power is the outcome of interest, it operates within the black box of family decision-making and cannot be directly observed. Instead, we use changes in family demand to signal changes in the distribution of power between husbands and wives. We first differentiate patterns that appear “male-driven” from those that appear “female-driven,” allowing for inferences about the direction of changes in bargaining power from changes in family demand. We then utilize recession-induced variation in unemployment rates over time and across states to identify and estimate the differential effects of the recession on the marital bargaining power of women. We estimate a 2.4 percentage point decrease in the male bias in consumption among families living in state where women’s economic opportunities improved relative to men’s.