WOMEN’S

EMPOWERMENT,
GENDER EQUALITY
AND DEVELOPMENT

Gaëlle Ferrant
Gaelle.ferrant@oecd.org

Master 2 DEIPM
26 October 2021
 Course outline
13h- Sept 28 Oct 12 Oct 26 Nov 09 Nov 23 Nov 30 Date
16h
(CET)
(online) (online) 1pm- 1pm- TBC
2-4pm 4.30pm 4.30pm
Topics Intro Gender Gender Gender in Gender Gender
studies: studies: developm data and data and
theory theory ent statistics statistics
and and agenda
empirical empirical and
evidence evidence cooperatio
n

Exam

14h45- Break Break Break Break Break Break

15h00

Presen
tations 2*20mi 2*20mi
n n 2
 Overview

1. Introduction to Family Economics

2. Microeconomic models of household
a. Why do individuals live together?
b. How do they take decisions?

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Introduction

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 Why do economists analyse
families?

• Oikonomía practised in the management

of a household or family, thrifty, frugal,
economical.“ (Oxford English Dictionary)

• “The family is the association established

by nature for the supply of men’s everyday
wants.” (Aristotle, Politics, Book1 part 2)

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 What makes Family Economics
different?

• The economic approach to the family can be

contrasted with that of biologists and sociologists.

• The economic approach to the family shares many

features of the employment relationship.
However, there are important differences that
originate from the non-economic aspect of the
marriage relationship:
– Love & blind trust
– Presence of children, as a « public good »

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 Economists’ interests in the family

• Cantillon (1730), Smith (1776) and Malthus (1798)

investigated the connections between economic
circumstances and the size of the population.

• Mill (1848) and Le Play (1855) analysed self-production,

insurance and redistribution of family resources.

• Becker (1973, 1974, 1991) introduced the unitary

approach to the family. This ties within family
allocations of time and goods to the aggregate patterns of
marriage and divorce.

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Main strands of Family Economics

Who
marries
whom
What
happens
inside
existing
unions

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Microeconomic models of household
a) Why do individuals live together?

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 Why do individuals live in
household?

• Living together => economies of scale

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 Why do individuals live in
household?

• Living together => economies of scale

1. sharing of public goods.
2. division of labor.
3. credit and investment activities.
4. risk pooling.
5. childcare.

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 Specialisation: Living alone

• For a single person the household production

function:
z = xt
where t denotes time spent on production and x
denotes purchased goods, with 0t 1
• Expenditure on the market good:
x = w(1-t)
where is the market wage for person
and
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 Specialisation: Living together

• 2 individuals a and b who can spend their time in market work or

home production of a single non-market good z.
• household production function:

• Time constraint:

• Produce the aggregate output

• their total output

>

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Household decision-making

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Household decision-making

– Time use
• Time devoted to labour outside and inside the
home
• Time devoted to personal care, leisure, etc.
– Consumption of market goods
– Investments, saving, etc.
– Household production of private and public
goods (e.g. children)

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A very special ‘public good’: child

How many When

Children

How to care for Marriage, divorce,

them re-marriage

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 Child care and specialisation

• We have three regimes:

– If both wages are high relative to efficiency at home
production, then both parents will work full-time in the
market and use only market goods for caring for the child.
– Conversely, if both wages are low relative to efficiency at home
production then parents will use only time to care for the
child.
– An intermediate case is the one in which the high wage
partner, b, has absolute advantage in market work and the low
wage person, a, has absolute advantage working at home, For
this intermediate case b will spend all his time in market work
and a will spend all her time looking after the child.

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 Microeconomic models of household
b) Household decision-making process

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 Household Production Function

• Household’s members consume both market

good and good produced within the household
• Inputs
– Time
– Market goods
• Constraints:
– Time
– Budget :
• Wage: opportunity cost
• Price: market goods

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 Utility function

• Satisfaction from
– Consumption of market goods
– Consumption of household produced goods
– Time devoted to various activities
– Welfare of other household members

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Unitary vs non-unitary Models

Unitary Model

Non-unitary Model
Cooperative
Non-cooperative

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Household utility function

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 Bargaining power and decisin-
making

• Collective model: cooperative non-unitary

model with Pareto efficiency
• Decision-making depends on individuals’
power
• Power is a function of wage, education,
etc.
• This explain why some Pareto efficient
decisions reinforce gender inequalities

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