Heterogeneous households: A within-subject test of asymmetric information between spouses in Kenya

Abstract

To identify which spouses respond to asymmetric information, I play two dictator games with each member of the couple. One decision is kept secret from the respondent's spouse, while another choice is public. Most people give the same amount in public and secret, while a minority behave opportunistically and give more to their spouse in public and less in secret. The types identified in the lab also behave differently at home. For those who behave opportunistically in the lab, greater knowledge about finances at home is associated with worse opportunism in the lab, suggesting that for these couples complete information at home is not due to trust but rather is an endogenous response to non-cooperative behavior. The paper highlights that allowing for heterogeneous types changes the conclusions we draw about appropriate models of the household and suggests that laboratory games can be used to identify household types useful in the interpretation of field data.

Household bargaining and spending on children: Experimental evidence from Tanzania

“…Similarly, Jakiela and Ozier (2016) find that women are willing to conceal their initial endowment, even though it reduces their potential earnings in the experiment. Finally, Castilla and Walker (2013) and Hoel (2015) find evidence of inefficiencies and hiding of income in their studies. We contribute to this literature on household decision-making by conducting a lab experiment that focuses on the effect on real-world outcomes (spending on children), rather than efficiency, cooperation, or testing of household models.…”

Structural Experimentation to Distinguish between Models of Risk Sharing with Frictions in Rural Paraguay

“…Both that paper and this rely on a strategy of varying whether the identity of the dictator is revealed, and whether the recipient is chosen by the dictator or chosen randomly. Other papers that play a combination of revealed and non-revealed games, and play games with different recipients but the same givers include Ado and Kurosaki (2014), which replicates Ligon and Schechter (2012) in Jakarta; Leider et al (2009) with Harvard undergraduates; Hoel (2015) with Kenyan spouses; Ambler (2015) with transnational household members in DC and El Salvador;and Porter and Adams (2016) with British parents and their children. These experiments all tease out players' types or preferences from differences in their behavior across games.…”

Families in Macroeconomics

“…When given the option, people often prefer to put money into private (and possibly secret) accounts. 42 Hoel (2015) finds in Kenyan data that 31 percent of people say their spouse was not aware of any income they had received the preceding week. Further, evidence from lab and field experiments suggests that information treatments affect intra-household allocations, suggesting that information frictions are important.…”

“…43 When income is private information in dictator games, less is transferred to the partner (Hoel 2015). Migrants send home less cash to family members when their choice is not revealed to the recipients (Ambler 2015).…”