This is a preliminary version of an evolving project-feedback highly appreciated. We thank Fabrizio Zilibotti for early discussions that helped shape some of the ideas in this paper. Financial support from the German Science Foundation (through CRC-TR-224 (project A3) and the Gottfried Wilhelm Leibniz-Prize) and the National Science Foundation (grant SES-1949228) is gratefully acknowledged. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peer-reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

Consumer bankruptcy provides partial insurance against bad luck, but, by driving up interest rates, makes life-cycle smoothing more difficult. We argue that to assess this trade-off one needs a quantitative model of consumer bankruptcy with three key features: life-cycle component, idiosyncratic earnings uncertainty, and expense uncertainty (exogenous negative shocks to household balance sheets). We find that transitory and persistent earnings shocks have very different implications for evaluating bankruptcy rules. More persistent shocks make the bankruptcy option more desirable. Larger transitory shocks have the opposite effect. Our findings suggest the current US bankruptcy system may be desirable for reasonable parameter values. (JEL D14, D91, K35)

Personal bankruptcies in the United States have increased dramatically, rising from 1.4 per thousand working age population in 1970 to 8.5 in 2002. We use a heterogeneous agent life-cycle model with competitive financial intermediaries who can observe households' earnings, age and current asset holdings to evaluate several commonly offered explanations. We find that increased uncertainty (income shocks, expense uncertainty) cannot quantitatively account for the rise in bankruptcies. Instead, stories related to a change in the credit market environment are more plausible. In particular, we find that a combination of a decrease in the transactions cost of lending and a decline in the cost of bankruptcy does a good job in accounting for the rise in consumer bankruptcy. We also argue that the abolition of usury laws and other legal changes are unimportant.

provided excellent research assistance. The views expressed herein are those of the author(s) and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peerreviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

Sub-Saharan Africa has a high incidence of polygyny. Countries in this region are also characterized by large age gaps between husbands and wives, high fertility, and the payment of a brideprice at marriage. In monogamous countries, on the other hand, the bride's parents traditionally give a dowry (negative brideprice) at marriage. Sub-Saharan Africa is also the poorest region of the world. In this paper I ask whether banning polygyny could play any role for development in Sub-Saharan Africa. Since this experiment does not exist in the data, I address the question using a formal model of polygyny and analyze the effects of enforcing monogamy within the model. I find that enforcing monogamy lowers fertility, shrinks the spousal age gap, and reverses the direction of marriage payments. The capital-output ratio and GDP per capita increase. The reason is that when polygyny is allowed, high brideprices are needed to ration women. Buying wives and selling daughters becomes a good investment strategy that crowds out investment in physical assets. I show that these effects can be large quantitatively. For reasonable parameter values, I find that banning polygyny decreases fertility by 40%, increases the savings rate by 70% and increases output per capita by 170%. * This is a chapter from my Ph.D. Dissertation at the University of Minnesota. It was previously circulated under the title "Polygyny and Poverty." This research was funded through a Doctoral Dissertation Fellowship from the University of Minnesota and an NSF grant. I am especially grateful to Larry E. Jones for his advice and encouragement. I would also like to thank Michele Boldrin, V

In recent US recessions, employment losses have been much larger for men than for women. Yet, in the current recession caused by the Covid-19 pandemic, the opposite is true: unemployment is higher among women. In this paper, we analyze the causes and consequences of this phenomenon. We argue that women have experienced sharp employment losses both because their employment is concentrated in heavily affected sectors such as restaurants, and due to increased childcare needs caused by school and daycare closures, preventing many women from working. We analyze the repercussions of this trend using a quantitative macroeconomic model featuring heterogeneity in gender, marital status, childcare needs, and human capital. Our quantitative analysis suggests that a pandemic recession will i) feature a strong transmission from employment to aggregate demand due to diminished within-household insurance; ii) result in a widening of the gender wage gap throughout the recovery; and iii) contribute to a weakening of the gender norms that currently produce a lopsided distribution of the division of labor in home work and childcare.

No abstract

We thank Todd Schoellman, John Knowles, and the participants at the NBER pre-conference in Boston, the Stanford Junior Faculty Bag Lunch, and the Economics and Demography conference in Napa California for helpful suggestions. We thank Amalia Miller in particular for a thoughtful discussion.