Title
Asymmetry of information within family networks Asymmetry of information within family networks
Author
Faculty/Department
Institute of Development Policy and Management
Publication type
article
Publication
Cambridge, Mass. ,
Subject
Sociology
Source (journal)
Working paper series / National Bureau of Economic Research [Cambridge, Mass.] - Cambridge, Mass.
Volume/pages
(2015) , p. 1-56
ISSN
0898-2937
Article Reference
21658
Carrier
E-only publicatie
Target language
English (eng)
Full text (Publishers DOI)
Affiliation
University of Antwerp
Abstract
This paper studies asymmetry of information and transfers within a unique data set of 712 extended family networks from Tanzania. Using cross-reports on asset holdings, we construct measures of misperception of income among all pairs of households belonging to the same network. We show that there is significant asymmetry of information and no evidence of major systematic over-evaluation or under-evaluation of income in our data, although there is a slight over-evaluation on the part of migrants regarding non-migrants. We develop a static model of asymmetric information that contrasts altruism, pressure and exchange as motives to transfer. The model makes predictions about the correlations between misperceptions and transfers under these competing explanations. Testing these predictions in the data uncovers the active role played by the recipient. Our findings suggest that the recipient sets the terms of the transfers, either by exerting pressure to give on the donor or by holding the bargaining power during the exchange of services with the donor.
Full text (open access)
https://repository.uantwerpen.be/docman/irua/fac958/130374.pdf
Handle