MEASURING POWER

There is a longstanding interest in how decisions about resource allocations are made within households and how those decisions affect the welfare of household members. Much empirical work has approached the problem from the perspective that if preferences differ, welfare outcomes will depend on the power of individuals within the household to exert their own preferences. Measures of power are therefore a central component of quantitative empirical approaches to understanding how differences in preferences translate into different welfare outcomes. Following most of the empirical studies in this genre, this paper focuses on dynamics within couples, although we recognize that dynamics among extended family members and across generations are of substantial interest. A number of different measures of power have been used in the literature. Because control over economic resources is seen as an important source of power, individual labor income, which one earns and so presumably controls to some degree, is one potential measure of power. However, whether and how much one works is a choice that is not likely to be independent of one’s power in the household. Non-labor income has also been used as a measure of power, but even if non-labor income does not reflect contemporaneous choices, it likely does reflect past choices, particularly labor supply choices, and so is also a function of power. Levels of resources brought to the marriage by each spouse, over which they may individually retain control, are even less proximate to the current choices of household members, but nevertheless reflect one’s taste in partners and therefore may not be exogenous to power. (In some instances, resources brought to the marriage may reflect decisionmaking by the couple’s parents, depending on the role that parents play in arranging marriages or transferring resources at the time of marriage.) A possible source of insight into the issue is to examine the impact of changes that affect the distribution of power within the household but that are plausibly exogenous to that power, such as changes in laws related to divorce or changes in benefit programs that provide resources to one member of the couple but not the other. Economic crises and the dislocations that accompany them may be another source of (exogenous) change that provides an opportunity to examine whether changes in the distribution of power within households is associated with changes in the welfare of individuals within the household. Another way to gain insight into intrahousehold decisionmaking is to develop additional, more plausibly exogenous, measures of power. In the absence of conducting natural experiments, it may be profitable to study variation in community norms or ethnic traditions that give rise to different levels of power for different household members. This approach has particular appeal for societies with heterogeneous cultures and those undergoing dramatic social change. This approach would require combining insights from the ethnographic and sociological literatures and from theoretical economic models of behavior, as well as knowledge of survey design and field practice. This paper describes an attempt to move in the direction of this ambitious agenda. Additionally, beyond the development of alternative or additional measures of power, it may also be useful to include in household surveys explicit questions to multiple household members about decisionmaking within the household. This provides insights into differences in perceptions among household members. Additionally, patterns of decisionmaking may be outcomes (and thus indicators) of relative power within households. Thus, indicators of decisionmaking shed light on how power manifests itself in everyday life. A goal of this project was to develop and field a decisionmaking module as part of a large-scale, multipurpose household survey, the second Indonesia Family Life Survey (IFLS2). The IFLS2 was fielded in 13 provinces in Indonesia between August, 1997, and February, 1998. From the point of view of working in heterogeneous and dynamic societies, Indonesia is an ideal laboratory. The IFLS is an ongoing panel survey, with the potential to provide a picture of the dynamics of power relationships over time and across the life course, an issue about which little is known. This paper describes the approach we took to developing the household decisionmaking module and presents preliminary results from the IFLS2. We use the IFLS2 data to address the following questions: 1) To what extent are day-to-day patterns of managing resources and making decisions consistent with the notion that, within households, members either share common preferences or the preferences of one member dominate? 2) Within households, who has the power over the purse strings? What characteristics predict power over the purse strings? 3) How do husbands and wives make decisions about expenditures and about use of time? Are there particular spheres where the man assumes control, and others where the woman dominates? Are certain spheres of decisionmaking more typically joint? 4) Can we identify indicators of relative power that can be collected in a field setting and that can enrich our tests of models of household behavior? Can measures of relative power used in other empirical studies be correlated with these indicators