Why do spouses communicate? Love or interest? A model and some evidence from Cameroon JOB MARKET PAPER

Roberta Ziparo
2014 unpublished
In first-hand data from Cameroon, we observe that household members often contribute jointly to intra-household expenditure, while at the same time having very imperfect knowledge of each other's income. This suggests the existence of information-flow problems in the household. This paper is the first theoretical analysis of communication incentives in the household. We assume that one spouse does not observe the income realization of the partner and we study under which condition an
more » ... ition an informative exchange of information can take place. We find that, when spouses do not have any common interest , non-communicating is the only equilibrium. We then introduce two possible motives for the existence of a commonality of intents among spouses-altruism and intra-household transfers due to productivity advantages-and we determine how those affect communication. We obtain testable predictions for each of the two motives. The Cameroonian data support the communication model based on transfers between spouses.