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III. Bargaining power: determinants and measurement.

The above discussion has indicated that "bargaining power" determines the share of resources allocated to an individual within the household. However, the concept of bargaining power is elusive. It is perhaps useful, at this point, to outline the possible determinants of bargaining power, while not making any claims to measure power itself.

A. Determinants of Bargaining Power

Bargaining power is affected by four sets of determinants: (1) control over resources, such as assets; (2) influences that can be used to influence the bargaining process; (3) mobilization of interpersonal networks; and (4) basic attitudinal attributes. (13)

Economic analysis of bargaining power has tended to focus on economic resources exogenous to labor supply as a major determinant of bargaining power. These include assets (e.g. Doss 1996; Thomas, Contreras, and Frankenberg 1997; Quisumbing 1994), unearned income (Schultz 1990; Thomas 1990), or transfer payments and welfare receipts (Lundberg, Pollak and Wales 1997; Rubaclava and Thomas 1997). The threat of withdrawing both oneself and ones assets from the household grants the owner of those assets some power over household resources. These threats are credible if supported by community norms or divorce laws. Indeed, Thomas et al. (1997) use assets at marriage as an indicator of bargaining power because in most of Indonesia, spouses can take what they brought into the marriage with them were the marriage to dissolve.

Factors which can influence the bargaining process include: legal rights, skills and knowledge, the capacity to acquire information, education, and bargaining skills. Some of these influences are external to the individual (e.g. legal rights), but many of them are highly correlated with human capital or education. In some instances, domestic violence can be used to extract resources from spouses or their families, as in the case of dowry-related violence in India (Rao 1997; Bloch and Rao 1996). Individuals can also mobilize personal networks to improve their bargaining power. Membership in organizations, access to kin and other social networks, and "social capital" may positively influence a person's power to affect household decisions. (14) Lastly, basic attitudinal attributes that affect bargaining power include self-esteem, self-confidence, and emotional satisfaction. While the economic literature has not dealt extensively with this issue, part of the success of group-based credit programs such as the Grameen Bank has been attributed to its group-based empowerment approach. Many NGOs have explicit empowerment objectives that go beyond economic means to include legal awareness, political participation, and use of contraception (Schuler et al. 1997b).

B. Measuring the Determinants of Power

Attempts to measure the bargaining power of individuals within the household in the economics literature have focused on control over economic resources. Candidate proxies for bargaining power have included: (1) public provision of resources to a particular member of the household and exogenous policy changes which affect the intrahousehold distribution of these resources (Lundberg, Pollak, and Wales 1997; Rubaclava and Thomas 1997); (2) shares of income earned by women (Hoddinott and Haddad 1995); (3) unearned income (Thomas 1990; Schultz 1990); (4) inherited assets (Quisumbing 1994); (5) assets at marriage (Thomas, Frankenberg, and Contreras 1997); and (6) current assets (Doss 1996).

Lundberg, Pollak, and Wales (1997) examine the effect of a policy which effectively transferred the child allowance from men to women in the United Kingdom in the late 1970s. They find that it increases the share of expenditures on women's clothing and children's clothing relative to men's clothing. Hoddinott and Haddad's (1994, 1995) work on Cote d'Ivoire investigates the effect of women's income share on the allocation of expenditures. Recognizing the endogeneity of women's income share, they use the difference in the educational attainment of the head and spouse, the proportion of land holdings and household business capital operated by adult women, the ratio of the spouse to the male heads education, and other dummy variables related to wife's schooling as instruments for the share of women's income. Thomas (1990) and Schultz (1990) use unearned income: Thomas (1990) tests the collective model by examining the effects of unearned income of men and women on nutrient intakes, fertility and child survival, and child anthropometrics, while Schultz analyzes the differential effects of men's and women's unearned income on labor supply and fertility in Thailand. Quisumbing (1994) examines the intrahousehold distribution of land and education as a function of father's and mother's education and inherited landholdings in the Philippines. Thomas et al. (1997) examine whether assets brought to marriage by husband and wife have a differential impact on child health in Indonesia. Finally, Doss (1996) examines the effects of current assets on the distribution of expenditure among different consumption categories in Ghana.

None of these measures is perfect. Labor income, which has often been included in computations of income shares (e.g. Kennedy 1992), is clearly problematic because it reflects time allocation and labor force participation decisions. Several studies (e.g., Thomas 1990; Schultz 1990) use nonlabor income (also called unearned income or nonwage income), either directly, or as an instrument for total income (Thomas 1993). Schultz (1990) and Thomas (1990) assume that nonearned income is independent of tastes and labor market conditions, which may not be true if much of nonearned income is from pensions, unemployment benefits, and earnings from assets accumulated over the life cycle. However, these concerns may be less critical in studies that focus on children (and households early in the life cycle) and in those that rely on measures of wealth that are typically inherited or given at the time of marriage (Strauss and Thomas 1995).

Current asset holdings, used by Doss (1996) in her study of Ghanaian households, may also be affected by asset accumulation decisions made within marriage. (15) Depending on provisions of marriage laws, assets acquired within marriage may be considered joint property and will not be easily assignable to husband or wife. The validity of inherited assets as an indicator of bargaining power may be conditional upon the receipt of these assets prior to marriage, unless bargaining power also depends on the expected value of inheritance. (16) Inherited assets could also be correlated with individual unobservables, such as previous investments in the individual during childhood (Strauss and Thomas 1995). Finally, assets brought to marriage, while exogenous to decisions made within marriage, could be affected by assortative mating and marriage market selection (Foster 1996).

Finding the appropriate indicator of bargaining power should be guided not only by the need to find a variable which is exogenous to bargaining occurring within marriage, but more importantly by the cultural relevance of these indicators. Increasingly, economists are turning to ethnographic evidence and qualitative methods used by sociologists and anthropologists to guide the construction of appropriate measures of bargaining power. (17) Based on anthropological evidence from the rural Philippines, Quisumbing (1994) argues that inherited landholdings are a valid measure of bargaining power since land is usually given as part of the marriage gift and major asset transfers occur at the time of marriage. Thomas et al. (1997) used ethnographic evidence and focus-group discussions in Indonesia to identify areas where women bring substantial asset holdings to marriage, and where they can claim these assets upon divorce. Noting that if male or female income" is measured with error, estimated income effects will be biased, Frankenberg and Thomas (1998) investigate the possible biases from reporting spouse's assets by interviewing husbands and wives separately and comparing their responses in the Indonesian Family Life Survey. However, assets controlled by the couple may not be the only relevant variable. In societies where the extended family is a key player in intrahousehold allocation, such as those in South Asia, characteristics of the extended family may affect intrahousehold allocation outcomes. (18)
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Title Annotation:Intrahousehold Allocation and Gender Relations: New Empirical Evidence
Publication:Intrahousehold Allocation and Gender Relations-New Empirical Evidence
Date:Oct 1, 1999
Previous Article:II. Modeling household behavior: a review.
Next Article:IV. The impact of male and female physical and human capital on intrahousehold outcomes.

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