Marriage and the Allocation of Assets in Women’s Defined Contribution Plans
Purchase on Springer.com
$39.95 / €34.95 / £29.95*
Rent the article at a discountRent now
* Final gross prices may vary according to local VAT.
The goal of this paper is to understand the effect of family decision-making on the investment decisions of married men and women. Using data from the Survey of Consumer Finances, we investigate how the spouse’s relative control over financial resources in the household and the life-cycle stage affect the investment choices of married women and men. The results show that married women who have more control over the financial resources are less likely to invest their Defined Contribution Plans (DCPs) in risky assets. Also, women who are married to relatively older men are less likely to take on risk with their DCPs. There is little evidence that the wife’s characteristics affect the investment decisions of married men.
- Ameriks, J., & Zeldes, S. P. (September 2004). How do household portfolio shares vary with age? TIAA-CREF working paper. Retrieved April 10, 2008, from http://papers.ssrn.com/sol3/papers.cfm?abstract_id=292017.
- Bajtelsmit, V., Bernasek, A., & Jianakoplos, N. (1999). Gender differences in defined contribution pension decisions. Financial Services Review, 8, 1–10. CrossRef
- Belsley, D. A., Kuh, E., & Welsch, R. E. (1980). Regression diagnostics: Identifying influential data and sources of collinearity. New York: Wiley.
- Bernasek, A., & Bajtelsmit, V. (2002). Predictors of women’s involvement in household financial decision-making. Financial Counseling and Planning, 13, 39–48.
- Bernasek, A., & Shwiff, S. (2001). Gender, risk, and retirement. Journal of Economic Issues, 35, 345–356.
- Bodie, Z., & Crane, D. B. (1997). Personal investing: Advice, theory and evidence. Financial Analysts Journal, 53(6), 13–23. CrossRef
- Browning, M. (2000). The saving behavior of a two-person household. Scandinavian Journal of Economics, 102, 235–251. CrossRef
- Byrnes, J., Miller, D. C., & Schafer, W. D. (1999). Gender differences in risk taking: A meta-analysis. Psychology Bulletin, 125, 367–383. CrossRef
- Chaulk, B., Johnson, P. J., & Bulcroft, R. (2003). Effects of marriage and children on financial risk tolerance: A synthesis of family development and prospect theory. Journal of Family and Economic Issues, 24, 257–279. CrossRef
- Dobbelsteen, S., & Kooreman, P. (1997). Financial management, bargaining and efficiency within the household: An empirical analysis. De Economist, 145, 345–366. CrossRef
- Donkers, B., Melenberg, B., & Van Soest, A. (2001). Estimating risk attitudes using lotteries: A large sample approach. Journal of Risk and Uncertainty, 22, 165–195. CrossRef
- Dwyer, P. D., Gilkenson, J. H., & List, J. A. (2002). Gender differences in revealed risk taking: Evidence from mutual fund investors. Economic Letters, 76, 151–158. CrossRef
- Employee Benefit Research Institute. (2001). Women in retirement. Retrieved April 10, 2008, from http://www.ebri.org/pdf/publications/facts/1101fact.pdf.
- Employee Benefit Research Institute. (2003). Private pension plans, participation, and assets: Update. Retrieved April 10, 2008, from http://www.ebri.org/publications/facts/index.cfm?fa=0103fact.
- Finke, M. S., & Huston, S. J. (2003). The brighter side of financial risk: Financial risk tolerance and wealth. Journal of Family and Economic Issues, 24, 233–256. CrossRef
- Freund, R. J., & Littell, R. C. (2000). SAS system for regression. Cary: SAS Institute.
- Friedberg, L., & Webb, A. (2006). Determinants and consequences of bargaining power in households. NBER working paper series, 12367. Retrieved April 10, 2008, from http://www.nber.org/papers/w12367.
- Friend, I., & Blume, M. E. (1975). The demand for risky assets. American Economic Review, 65, 900–922.
- Greene, W. H. (2003). Econometric analysis (5th ed.). New Jersey: Prentice Hall.
- Gujarati, D. N. (2002). Basic econometrics (4th ed.). New York: McGraw-Hill College.
- Heaton, J., & Lucas, D. (2000). Portfolio choice and asset prices: The importance of entrepreneurial risk. Journal of Finance, 55, 1163–1198. CrossRef
- Hinz, R., McCarthy, D., & Turner, J. (1997). Are women conservative investors? Gender differences in participant-directed pension investments. In M. Gordon, O. Mitchell, & M. Twinney (Eds.), Positioning pensions for the twenty-first century. Philadelphia: University of Pennsylvania Press.
- Hudgens, G. A., & Fatkin, L. T. (1985). Sex differences in risk taking: Repeated sessions on a computer-simulated task. Journal of Psychology, 119, 197–206.
- Jianakoplos, N. A., Bajtelsmit, V. L., & Bernasek, A. (2003). How marriage matters to pension investment decisions. Journal of Financial Service Professionals, 57, 48–57.
- Jianakoplos, N. A., & Bernasek, A. (1998). Are women more risk averse? Economic Inquiry, 36, 620–630. CrossRef
- Jianakoplos, N. A., & Bernasek, A. (2008). Family financial risk taking when the wife earns more. Journal of Family and Economic Issues, 29, 289–306. CrossRef
- Levin, I. P., Synder, M. A., & Chapman, D. P. (1988). The interaction of experiential and situational factors and gender in a simulated risky decision-making task. Journal of Psychology, 122, 173–181.
- Lindamood, S., Hanna, S. D., & Bi, L. (2007). Using the survey of consumer finances: Methodological considerations and issues. Journal of Consumer Affairs, 41, 195–214.
- Lundberg, S. J., & Pollak, R. (1994). Non-cooperative bargaining models of marriage. American Economic Review, 84(2), 132–137.
- Lundberg, S. J., & Pollak, R. (1996). Bargaining and distribution in marriage. Journal of Economic Perspectives, 10(4), 139–158.
- Lundberg, S. J., Startz, R., & Stillman, S. (2003). The retirement-consumption puzzle: A marital bargaining approach. Journal of Public Economics, 87, 1199–1218. CrossRef
- Lundberg, S. J., & Ward-Batts, J. (2000). Saving for retirement: Household bargaining and household net worth. Working paper. University of Michigan: Michigan Retirement Research Center. Retrieved April 10, 2008, from http://www.mrrc.isr.umich.edu/publications/conference/pdf/cp00_lundberg.pdf.
- Malone, K., Stewart, S. D., Wilson, J., & Korsching, P. F. (2010). Perceptions of financial well-being among American women in diverse families. Journal of Family and Economic Issues, 31, 63–81. CrossRef
- Merton, R. C. (1969). Lifetime portfolio selection under uncertainty: The time case. Review of Economics and Statistics, 51, 247–257. CrossRef
- Molina, J. A., & Montuenga, V. M. (2009). The motherhood wage penalty in Spain. Journal of Family and Economic Issues, 30, 237–251. CrossRef
- Powell, M., & Ansic, D. (1997). Gender differences in risk behavior in financial decision-making: An experimental analysis. Journal of Economic Psychology, 18, 605–628. CrossRef
- Riley, W. B., & Chow, K. V. (1992). Asset allocation and individual risk aversion. Financial Analysts Journal, 48(6), 32–37. CrossRef
- Samuelson, P. A. (1969). Lifetime portfolio selection by dynamic stochastic programming. Review of Economics and Statistics, 51, 239–243. CrossRef
- Sanders, C. K., & Porterfield, S. L. (2010). The ownership society and women: Exploring female householders’ ability to accumulate assets. Journal of Family and Economic Issues, 31, 90–106. CrossRef
- Säve-Söderbergh, J. (2003). Pension wealth: Gender, risk and portfolio choices. Essays on gender differences in economic decision-making, Ph.D. Dissertation, Swedish Institute for Social Research: Stockholm University.
- Siegel, F. W., & Hoban, J. P. (1982). Relative risk aversion revisited. Review of Economics and Statistics, 64, 481–487. CrossRef
- Sundén, A. E., & Surette, B. J. (1998). Gender differences in the allocation of assets in retirement savings plans. American Economic Review, 88(2), 207–211.
- Sung, J., & Hanna, S. D. (1998). The spouse effect on participation and investment decisions for retirement funds. Financial Counseling and Planning, 9, 47–58.
- Uccello, C. E. (2000). Do spouses coordinate their investment decisions in order to share risks? Center for Retirement Research, WP 2000–2009. Retrieved April 10, 2008, from http://crr.bc.edu/images/stories/Working_Papers/wp_2000-09.pdf.
- Ulker, A. (2009). Wealth holdings and portfolio allocation of the elderly: The role of marital history. Journal of Family and Economic Issues, 30, 90–108. CrossRef
- U.S. Department of Labor Employee Benefits Security Administration. (2006). Private pension plan bulletin abstract of 2003 from 5500 annual reports. Retrieved April 10, 2008, from http://www.dol.gov/ebsa/PDF/2003pensionplanbulletin.PDF.
- Woolley, F. (2003). Control over money in marriage. In S. A. Grossbard-Shechtman (Ed.), Marriage and the economy: Theory and evidence from advanced industrial societies. Cambridge: Cambridge University Press.
- Yilmazer, T. (2008). Saving for children’s college education: An empirical analysis of the trade-off between the quality and quantity of children. Journal of Family and Economic Issues, 29, 307–324. CrossRef
- Young, M. C., & Wallace, J. E. (2009). Family responsibilities, productivity, and earnings: A study of gender differences among Canadian lawyers. Journal of Family and Economic Issues, 30, 305–319. CrossRef
- Marriage and the Allocation of Assets in Women’s Defined Contribution Plans
Journal of Family and Economic Issues
Volume 31, Issue 2 , pp 121-137
- Cover Date
- Print ISSN
- Online ISSN
- Springer US
- Additional Links
- Financial decision-making
- Investment choice
- Risk aversion
- Industry Sectors
- Author Affiliations
- 1. Department of Personal Financial Planning, University of Missouri, 239 Stanley Hall, Columbia, MO, 65211, USA
- 2. Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, 421 Mumford Hall, 1301 W. Gregory Drive, Urbana, IL, 61801, USA