Spousal Control and Efficiency of Intra-household Decision-Making: Experiments among Married Couples in India, Ethiopia and Nigeria

Given the importance of the household as a resource allocation mechanism, considerable interest exists in its efficiency. Most of the non-experimental evidence for inefficiency comes from West African farm households in which husbands and wives pursue separate productive activities. Using experiments, we test for efficiency of spouses’ resource allocation decisions in a range of household types. In North India, we select households that are unified, in northern Nigeria households characterised by separate spheres of economic decision-making. Our other sites occupy carefully selected intermediate positions on the spectrum from unitary to separate-spheres household types. We find that, the more separate the decision-making in real life, the less efficient the resource allocation in the experiments. Moreover, female control of resource allocation tends to lower efficiency, in contrast to male control. The exception is a site in northern Nigeria where female control of resource allocation is well established.