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Do Financial Incentives Aimed at Decreasing Interhousehold Inequality Increase Intrahousehold Inequality?

Author

Listed:
  • Amanda Chuan
  • John List
  • Anya Samek

Abstract

Research has shown that giving disadvantaged families financial incentives to invest in their children could decrease socioeconomic inequality by enhancing human capital formation. Yet, within the household how are such gains achieved? We use a field experiment to investigate how parents allocate time when they receive financial incentives. We find that incentives increase investment in the target child. But, parents achieve these gains by substituting away from time spent with the child's sibling(s). An unintended consequence is that intrahousehold inequality increases and aggregate gains from the program are overstated when focusing only on target children.

Suggested Citation

  • Amanda Chuan & John List & Anya Samek, 2021. "Do Financial Incentives Aimed at Decreasing Interhousehold Inequality Increase Intrahousehold Inequality?," Framed Field Experiments 000731, The Field Experiments Website.
    • Handle: RePEc:feb:framed:000731
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education
    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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