Template-Type: ReDIF-Paper 1.0
Title: Private Information in the Family
Author-Name: Suzanne Bellue
Author-Email: suzanne.bellue@ensae.fr
Author-Name: Matthias Doepke
Author-Email: m.doepke@lse.ac.uk
Author-Name: Michele Tertilt
Author-Email: tertilt@uni-mannheim.de

Classification-JEL: D13, D82, J12, J16
Keywords: Family Economics, Marital Bargaining, Gender, Private Information, Asymmetric Information

Abstract: Standard models of the family assume that spouses share information. In this paper, we
challenge this assumption with theory and evidence. We field a new survey module in the
Dutch LISS panel where spouses independently report their knowledge of each other's
finances. Private information is pervasive: in 40 percent of couples, at least one partner lacks
full knowledge of the other's income. We examine the implications of private information for
intrahousehold risk sharing using a mechanism design approach. Our model predicts that a
spouse's consumption share rises with their income share when information frictons are
present but is independent of income under full information. Constrained-efficient
allocations can be sustained without full revelation: each spouse chooses how much money
to bring home, and hidden income is never revealed. Evidence from the LISS panel confirms
the predictions: a positive relationship between income and consumption shares appears
only among imperfectly informed couples. Controlling for limited commitment does not
affect this result, suggesting that information asymmetries---rather than commitment
frictions---drive departures from full insurance.

Note: 
Length:59
Creation-Date:2026-03
Revision-Date: 
File-URL: https://www.crctr224.de/research/discussion-papers/archive/dp738
File-Format: application/pdf
Handle: RePEc:bon:boncrc:CRCTR224_2025_738