Family Economics

Family economics applies basic economic concepts such as production, division of labor, distribution, and decision making apply to the study of the family. Using economic analysis it tries to explain outcomes unique to family- such as marriage, the decision to have children, fertility, polygamy, time devoted to domestic production, and dowry payments.

The family, although recognized as fundamental from Adam Smith onward, received little systematic treatment in economics before the 1960's. Important exceptions are Thomas Malthus' model of population growth and Friedrich Engels' pioneering work on the structure of family, the latter being often mentioned in Marxist and feminist economics. Since the 1960's Family Economics has developed within mainstream economics, propelled by the New Home Economics started by Gary Becker, Jacob Mincer, and their students. Standard themes include:

  • fertility and the demand for children in developed and developing countries
  • child health and mortality
  • interrelation and trade-off of 'quantity' and 'quality' of children through investment of time and other resources of parents
  • altruism in the family, including the rotten kid theorem
  • sexual division of labor, intra-household bargaining, and the household production function.
  • mate selection, search costs, marriage, divorce, and imperfect information
  • family organization, background, and opportunities for children
  • intergenerational mobility and inequality, including the bequest motive.
  • human capital, social security, and the rise and fall of families
  • macroeconomics of the family.

Several surveys, treatises, and handbooks are available on the subject.

Read more about Family Economics:  History of Family Economics, Marriages As Firms, Division of Labor Within The Family, Decision-making in The Family

Famous quotes containing the words family and/or economics:

    What we often take to be family values—the work ethic, honesty, clean living, marital fidelity, and individual responsibility—are in fact social, religious, or cultural values. To be sure, these values are transmitted by parents to their children and are familial in that sense. They do not, however, originate within the family. It is the value of close relationships with other family members, and the importance of these bonds relative to other needs.
    David Elkind (20th century)

    There is no such thing as a free lunch.
    —Anonymous.

    An axiom from economics popular in the 1960s, the words have no known source, though have been dated to the 1840s, when they were used in saloons where snacks were offered to customers. Ascribed to an Italian immigrant outside Grand Central Station, New York, in Alistair Cooke’s America (epilogue, 1973)