Do Cohabiting Couples Underinvest in Household Public Goods? The Effect of Relationship Status on Households' Experience of Material Hardship in the Fragile Families and Child Wellbeing Study

Catherine T. Kenney, Princeton University

This paper uses data from the Fragile Families and Child Wellbeing Study (FFCW) to examine the extent to which the economic relationship between parents in cohabiting as opposed to married households affects the material hardship experienced by members of those households. My approach is to consider the availability and adequacy of certain household public goods, such as housing, heat, and electricity. Based on predictions generated from cooperative and non-cooperative bargaining models of intrahousehold resource allocation as well as from sociological literature on households, I examine the extent to which differences in relationship status, sources and types of income, and household composition influence the standard of living available to household members when total household income is controlled. I also test whether couples' money management patterns-whether they say they put all their resources together or keep some or all separate-appear to act as mediating factors in determining expenditures on household public goods.