Some Evolutionary Economics of Family Partnerships

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Some Evolutionary Economics of Family Partnerships
Ted Bergstrom, UCSB
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An Arboreal Allegory

• Alice and Bob live on fruit and berries.
• They get cold at night.
• Alice is a skilled fire-builder. Bob is not.

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Primitive cooperation

• Alice divides her time between gathering food and
  building fire.
• Bob doesnt try building fires. He spends all of
  his time gathering food and he huddles next to
  Alices
• And wishes she would build a bigger fire.
• Bob leaves some food by the fire for Alice.
• He benefits because Alice makes a bigger fire.
  (income effect of food Bob leaves)

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Too Little Fire

• No love or altruism is involved. Both benefit
  from Bobs gifts to Alice.
• But there is still an undersupply of fire.
• Alice accounts only for her own benefit when
  deciding how much fire to build.
• A scheme where Bob pays Alice a wage that
  depends on how much wood she gathers would make
  both better off.
• But this requires monitoring that may not be
  possible.

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Case of common interests

• Suppose that all that Alice and Bob really care
  about is the size of the fire.
• They want food only because it gives them
  strength to do their work.
• Then Alice and Bob have dominant strategies.
• Bob eats enough to maximize the amount that he
  can give to Alice.
• Alice eats enough to maximize the size of fire
  that she can build.
• Both agree about what each should do. Outcome is
  efficient.

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How are children like fire?

• Suppose the household good is children, who
  share genes of two parents.
• Evolutionary theory predicts selection for
  behavior that maximizes surviving descendants.
• Consumption of goods not an end in itself, but an
  instrument for reproductive success.

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Monogamy

• Lifelong monogamous couples share identical
  reproductive goal.
• Each is a perfectly motivated agent of the
  others reproductive success.
• Common interest may be evolutionary foundation of
  conjugal love.

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Snakes in Eden

• In-law problem and the theory of kin-selection
• Adultery
• Divorce
• Death and remarriage

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The Mystery of the Demographic Transition

• Rise of real wages and decline of net
  reproduction rate.
• Western Europe 1870 to present
• Late 20th century much of Asia and Latin America
• Puzzling to zoologists. How could natural
  selection produce a creature that reduces
  fertility when resources are abundant?

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Economists Explanations

• Price effects. Children are labor intensive
  goods. As wages rise, their cost rises.
• Requires price elasticity of demand for children
  to exceed income elasticity
• Hard to reconcile with cross sectional data
• Technology has increased payoff to human capital,
  making it more desirable to have fewer, but
  better-educated children.
• But historians claim skill premiums actually fell
  from 18th century to present. (G. Clark)

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Evolutionary explanations?

• If joint reproductive success is ultimate
  motivation of couples, reproduction must
  eventually rise with wages.
• No evidence that this is happening.
• Perhaps conditions are so different from
  historic evolutionary environment that our
  actions result of misreading cues.

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Another explanation

• Humans evolved with less than complete monogamy.
• Conflict of interest between males and females.
• An additional child is more costly to female than
  to male.
• She may die in childbirth
• Siblings suffer They are surely hers not so
  surely his.

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Household Conflict

• Empirical studies show pattern of household
  expenditures depends on which household member
  has the earnings.
• If wife has larger share of household income,
  more is spent on child health, food, and
  education.
• Theory that shares of income influence
• bargaining power in family decisions.

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Tug of War

• If males prefer shorter birth intervals than
  females, outcome will be result of a tug of war
  between conflicting interests.
• Evolution might favor females who prefer birth
  rates lower than their true genetic interest and
  males prefer rates that are higher than their
  preferred rates.
• Differences in birth rates might reflect shifts I
  power between the sexes.

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Power Shift Theory

• A contributing factor to the demographic
  transition may be that
• Mechanization has made the skills of females more
  valuable relative to the brute strengh of males.
• Power and influence has shifted from males to
  females.
• With their increased influence, females have
  shifted family decisions to lower fertility

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