Scandinavian Working Papers in Economics

Working Papers in Economics,
University of Gothenburg, Department of Economics

No 724: Decision-making within the Household: The Role of Autonomy and Differences in Preferences

Yonas Alem (), Sied Hassen and Gunnar Köhlin ()
Additional contact information
Yonas Alem: Department of Economics, School of Business, Economics and Law, Göteborg University, Postal: P.O. Box 640, SE 40530 GÖTEBORG, Sweden
Sied Hassen: Environment and Climate Research Center of the Ethiopian Development Research Institute, Postal: P.O. Box 640, SE 40530 GÖTEBORG, Sweden
Gunnar Köhlin: Department of Economics, School of Business, Economics and Law, Göteborg University, Postal: P.O. Box 640, SE 40530 GÖTEBORG, Sweden

Abstract: We use a field experiment to identify how differences in preferences and autonomy in decision-making result in sub-optimal adoption of technologies that can maximize the welfare of all members of the household. We create income-earning opportunities and elicit willingness- to-pay (WTP) for energy-efficient cookstoves through a real stove purchase experiment with randomly chosen wives, husbands and couples. Experimental results suggest that women, who often are responsible for cooking and for collecting fuelwood, reveal a higher preference than men for the improved stoves. Using an instrumental variables tobit estimator, we show that women who have higher decision-making autonomy reveal higher WTP than those who have lower decision-making autonomy. A follow-up survey conducted 15 months after the stove purchase show that autonomy does not affect stove use. Our findings highlight the importance of considering division of labor, different preferences, and bargaining power differences within the household when promoting adoption of new household technologies.

Keywords: Preference Difference; Decision-making; Autonomy; Willingness-to-pay

JEL-codes: C93; D13; O12; Q56

32 pages, March 2018

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