Robert A. Pollak, a member of our ECI, FI, and IP networks, recently met with HCEO to discuss his work on the economics of the family, and in particular, the implications of bargaining in families for equilibrium in marriage markets.
"I’ve always been interested more generally in social science issues," Pollak explains. "I never was fully socialized into economics."
Pollak notes that the way economists study the family has changed greatly over the course of his career. "The standard model of the family in economics, which really goes back to the work of Gary Becker, is a model in which children are born to married parents, who stay married as the children grow up, and who invest in the children’s human capital," he says. "That view really became untenable. And the question in my mind was: How can you use the tools of economics to model what’s going on in more complex families?"
This has been the focus of much of Pollak's recent work. In regards to the marriage market, he has found that questions around how things are allocated within a marriage, who marries whom, and who gets married at all, can yield very different outcomes. "It turns out that if people bargain after they’re married, that you need not get Pareto efficient outcomes," he says.
Pollak has already recently become interested in studying the role of wealth in families."Economists have generally focused on income, and on parents' education, which are relatively easy things to measure," he says. "We don’t know nearly enough about wealth." He notes that data tends to focus on household wealth, which doesn't make a lot of sense for unstable households, or young people.
"Since we know, on the work of bargaining in families, that who controls income makes a lot of difference in terms of outcomes, it’s a reasonable conjecture that who controls wealth ought to make a difference also," he says. "And yet our data really doesn’t report that."
Pollak is the Hernreich Distinguished Professor of Economics at Washington University in St. Louis.