TY  - RPRT
        AU  - Iyigun, Murat
AU  - Walsh, Randall P.
        TI  - Building the Family Nest: Pre-Marital Investments, Marriage Markets and Spousal Allocations
        PY  - 2005/Sep/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 1752
        UR  - https://www.iza.org/publications/dp1752
        AB  - We develop a model of the household in which spousal incomes are determined by pre-marital investments, the marriage market is characterized by assortative matching, and endogenously-determined sharing rules form the basis of intra-household allocations. By incorporating pre-marital investments and spousal matching into the collective household model, we are able to identify the fundamental determinants of endogenously determined and maritally sustainable intra-marital sharing rules. In particular, we find that all sharing rules along the assortative order support unconditionally efficient outcomes where both pre-marital investments and intra-household allocations are efficient. The efficiency of both pre-marital choices and household allocations then enables us to show that, for each couple, the marriage market generates a unique and maritally sustainable sharing rule that is a function of the distribution of pre-marital endowments and the sex ratios in the market.
        KW  - marriage
KW  - bargaining
KW  - household labor supply
KW  - collective model
        ER  -