Pooling of Economic Resources: A Comparison of Norwegian Married and Cohabiting Couples

Abstract

Using Norwegian survey data (n = 4116), we study couples" likelihood of pooling their economic resources. The proportion of cohabitation compared to marriages is high in Norway. Over the last decades, tax policy and the social security system have moved towards equating cohabitation with marriage. Our knowledge of the economic organization of the two types of couples is, however, rather imperfect. Our main hypothesis is that cohabitants are less likely to pool their economic resources than married couples, but that this difference is less if they hold plans to marry. We take into account important factors that largely have been ignored in many earlier studies, namely the presence of children and the duration of the relationship. The results confirm our hypothesis but also show that the difference between cohabitants and married couples is reduced once these important factors are controlled for.Implications for policy are discussed.(145 words)

Pooling and Sharing Income within Households: A Satisfaction Approach

“…Vogler (2005) reports about a study conducted by Ludwig-Mayerhofer (2000) who found that about 70% of married couples in Germany use the non-segregated joint pooling system to manage their money, whereas cohabiting couples mainly manage their money separately. Similar patterns are found for Norway, Sweden and Canada (Vogler, 2005;Lyngstad et al, 2010). However, most cohabiting couples who have at least one biological child together pool incomes, similar to married couples (McRae, 1993;Winkler, 1997;Lewis, 2001).…”

“…Phipps and Burton, 1995). The increasing plurality of family structures raises doubts that the assumptions of pooling and equal sharing of incomes remain valid, because prior evidence suggests that the majority of cohabiting couples maintain systems of individualized management of resources instead of pooling each partner's whole income (Vogler, 2005;Kenney, 2006;Lyngstad et al, 2010). Implications based on assumptions of the pooling and equal sharing of incomes therefore remain valid for a declining number of households, if at all.…”

“…how partners deal with the fact that they each receive a potentially different income and both face shared expenditures, e.g. for rent, heating or the children (Pahl, 1989;Heimdal and Houseknecht, 2003;Vogler et al, 2006;Lyngstad et al, 2010;McRae, 1993;Winkler, 1997;Lewis, 2001). From this perspective, income pooling is the first but necessary step of allocating income, i.e.…”

Free to stay, free to leave: Insights from Poland into the meaning of cohabitation

“…For example, cohabiting partners may have a lower propensity to have children together and to develop relationships with the other partner"s relatives (Hogerbrugge and Dykstra 2009). Couples in informal unions may avoid pooling resources, holding jointly owned property, and adopting a division of responsibilities within and outside of the household in which one of the partners is economically dependent on the other (Lyngstad, Noack, and Tufte 2011). Being in an informal union may also encourage the partners to develop their own skills and interests, rather than sacrificing them for the sake of the joint household.…”

Exploring social norms around cohabitation: The life course, individualization, and culture

“…This extensive literature has made great strides towards understanding the trends (e.g., Perelli-Harris and Lyons-Amos 2015; Hoem et al 2009;Heuveline and Timberlake 2004;Andersson and Philipov 2002;Kiernan 2004), correlates (e.g. Hiekel, Liefbroer, and Poortman 2014;Perelli-Harris et al 2010;Wiik, Keizer, and Lappegård 2012), and effects of partnership formation (e.g., Hiekel and Castro-Martin 2014;Lyngstad et al 2011;Soons, Liefbroer, Kalmijn 2009). However, most of these studies are primarily the outcome of a structured process of data collection in which respondents fit their answers to predefined alternatives.…”