Does marriage work as a savings commitment device? Experimental evidence from Vietnam.

ABSTRACT: Present bias, or the overvaluation of an immediate payoff, causes under-saving and financial difficulty. We investigate whether married couples utilize their spouses as a savings commitment device to alleviate the present bias problem using experimental and survey data in Vietnam. We find that individuals are less present biased when making joint decisions with their spouses than they are when making decisions alone. However, present-biased individuals turn over a smaller ratio of their earnings to their spouses and are more likely to manage household resources than time-consistent individuals are. Present-biased individuals also receive larger amounts of money from their spouses' incomes, indicating that marriage not only fails to function as a savings commitment device but also exacerbat

SUBMITTER: Kono H 

PROVIDER: S-EPMC6583950 | biostudies-literature | 2019

REPOSITORIES: biostudies-literature