Who really holds the purse strings? Why it matters which partner decides where the money goes

Oct. 16, 2024 - The Conversation Indonesia

This bargaining power refers to the ability of one partner to influence decisions that affect the household – the partner with more bargaining power has a greater say. To investigate this, my research partners and I analysed household investment decisions in Australia, Germany and the US.

In the US and Germany, men hold even greater sway, with their bargaining power rising to 61% and 69% respectively. While men’s greater bargaining power could be justified if they were better traders, evidence suggests they tend to trade more frequently and underperform compared to women.

This isn’t just about fairness; it’s about ensuring that families make sound financial decisions that reflect the needs and preferences of all members...