The impact of more complex family structure upon marital earnings premiums

Abstract

This article employs a unique data set from Trinidad and Tobago to examine the impact of their more complex family structures upon marital earnings premiums. While family structure includes the single married couple structure common in the US, families in Trinidad and Tobago often have more adults living in the household, multiple married couples living in the same family, and multigenerational families. Marital premiums for family members most likely to invest in labor market production are estimated to increase with more complex family structure. In contrast, estimated marital premiums for members most likely to invest in home production are decreased with more complex family structure. Results suggest that specialization within the larger family help explain the existence of marital premiums.

Keywords:

• family structure
• marital wages
• developing economies

JEL Classifications:

• J12
• J31
• O15

Acknowledgements

A previous version of this paper was presented at the Midwest Economics Association meetings in March of 2005. An anonymous referee provided helpful comments.

Notes

1. Tables 2 and 3 illustrate that 65.6% of males in the full sample were working, while only 32.5% of women in the full sample were working. The censored wage data (i.e., market wages are only included for workers) raises the issue of selection bias. It had been common to use the simple selection correction procedure first introduced by Heckman (1979). However, Manski (1989) notes that this approach introduces its own biases and that the difference between this procedure and OLS are small. In fact, the selection correction procedure has no significant impact on the estimated results in Tables 4 and 5. Hence, only the OLS results are presented here. Sample selection‐corrected estimates are available from the author upon request.