Testing the Unitary and Nash Bargaining Household Models in India

This paper tests the unitary or common preference approach versus the collective models of household behaviour in India. Using the independent female unearned income as an indicator of female’s control over resources within the household in the bargaining strategy, we study the effect of pooled unearned income versus independent unearned income of the spouses on five household decisions, viz., male and female labour supply, household expenditures on food, education and health. The OLS estimates show that while the female independent unearned income has negligible influence, the male independent unearned income has positive and significant effects on most household decisions, indicating the weak bargaining strengths and insignificant influence of female over household resource allocation decisions.