Theses Doctoral

Essays in Family Economics

Koh, Yu Kyung

This dissertation consists of three essays in family economics. The underlying objective of this dissertation is to better understand inequality in family formation and in intra-household allocation. The first two chapters study racial sorting in the United States marriage market. The third chapter studies the effects of higher female bargaining power on household consumption of married couples in the United States.

Chapter 1 studies the unequal gains from racial desegregation in the United States marriage market. Interracial marriages have increased in the United States over the past several decades, but the trends differ across race, gender, and education groups. This suggests that racial desegregation in the marriage market may not have equally improved the marriage prospects of different groups. This paper studies why some groups have gained more from marital desegregation than others over the past four decades. To this end, I build a transferable utility matching model to define and estimate the welfare gains from marital desegregation by comparing the equilibrium rates of singlehood in the observed marriage market with those in a completely segregated marriage market. I find that among Blacks and Whites, college-educated men gained more than their female and lower-educated male counterparts. To understand why, I implement a decomposition method to quantify how changing population and changing marital surplus have shaped the unequal gains, accounting for general equilibrium effects. I find that the rise in the welfare gains for college-educated Black men is largely driven by the increase in the joint surplus from marriage with college-educated White women. Other Black men and women did not benefit as much from any change in the marital surplus, implying that race relations have not substantially improved in the marriage market except for the most educated Black men. I also find that the rise in welfare gains for college-educated White men is driven by the female-biased population increase among college graduates. Simulation results suggest that fixing the unbalance in marital surplus and making progress toward racial integration in the marriage market would significantly improve marriage outcomes for Black men and women.

Chapter 2 examines the geographical variation in racial sorting in the United States marriage market. There are substantial variations in interracial marriage rates across states, but it is challenging to disentangle the role of marital surplus from the population composition. I use a structural marriage market model to document the geographical variation and time trends in the racial assortativeness in marital matching across the US states. I document several new facts. First, preference for same-race marriage compared to different-race marriage is the highest in the southern states and the lowest in the western states, even after controlling for the demographic composition. Second, the ranking of each state in terms of racial assortative matching has been persistent over the past four decades. Third, the geographic variation in racial assortative matching is closely related to the racial attitudes of White respondents, but not of Black respondents. This suggests that geographic variation in racial assortative matching may be driven more by White people's marital preferences than by Black people's marital preferences. In terms of individual welfare gains from interracial marriage, I find that higher-educated Black men living in the West benefit more from interracial marriage and those living in the South do not benefit at all from interracial marriage. This is consistent with the geographical patterns in racial assortative matching. On the other hand, Black women do not benefit at all from interracial marriage regardless of where they live.

Chapter 3, which is joint work with So Yoon Ahn, studies how spousal bargaining power affects consumption patterns of married households in the US, using a detailed barcode-level dataset. While there has been substantial evidence from developing countries settings that bargaining power within the household affects household consumption, there is a lack of such evidence in more developed country settings like the US. To study this, we use two distribution factors as proxies for spousal bargaining power: spouses' relative education and spouses' relative potential wage, which is our preferred distribution factor. As an arguably exogenous measure of bargaining power, our relative potential wage is constructed as a Bartik-style measure of the female-to-male wage ratio, exploiting county-level variations in heterogeneous exposure to different industries and state-wide wage growth. We find that the expenditure shares on women's beauty goods increase and the expenditure shares on alcohol decrease significantly both when the relative education of wives increases and when the relative potential wages of wives increase. These results are consistent with household bargaining explanations. For couples with children, improved women's household bargaining position is associated with a higher budget share on books, stationery, and school supplies, which are potentially related to investment in children. Our evidence shows that local labor market condition that is favorable to women than men shifts household consumption towards more female-preferred goods among married couples in the US.


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More About This Work

Academic Units
Thesis Advisors
Chiappori, Pierre-André
Salanié, Bernard
Ph.D., Columbia University
Published Here
June 2, 2023