The Effect of Violent Crime on Intra-household Resource Allocation and Bargaining Power


Speaker:Maria Hernandez De Benito, University of Alicante
Date: Friday 29 October 2021
Time: 14:00
Location: online

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The effects of exposure to community violence are numerous and complex, and we should not expect them to be gender-neutral. This paper studies the effects of violent crime on household expenditures and intra-household bargaining power. I exploit an unexpected and geographically heterogeneous increase in local violence in Mexico using a nationally representative longitudinal survey of married households formed prior to the increase in crime. I first estimate a household demand model and find that the escalation in violence reallocated household expenditures towards male goods, at the expense of food and other household necessities. These findings would typically be interpreted as a deterioration in women's bargaining power. But changes in local violence may have also affected consumption preferences. To show that the results can be explained by changes in bargaining power, I compute the effect of violence on intra-household resource shares within a structural setup that allows for violence to also affect preference parameters. The increase in violence also led the household members themselves to report decreases in female decision-making power. Finally, I discuss the evidence on the role played by fear of victimization limiting women's outside options.