Managing and controlling money in marriage

The story so far is that marriage marks the boundaries of an important kind of domestic money for middle-income AngloCeltic couples. Marriage money is domestic, private, personal, joint and nebulous. Jointness is central to the meaning of marriage money and is increasingly symbolised by the joint account. I now argue that jointness in marriage money does not always translate to joint management and control of money in marriage. I make two points. First, for people under 65, money is being managed and controlled within a framework that is more joint than in their parents' generation. Second, electronic banking technology delivers more information about money in the joint account.

MONEY MANAGEMENT AND CONTROL

In the 1980s there was a spate of work on money management and control within the household, particularly in Australia and the United Kingdom. This moved away from the usual economists' assumption that the household was an undifferentiated 'black box' that earned and spent as an individual. It was assumed that resources were shared equally ( Pahl 1989, 1990). Economists such as Amartya Sen ( 1977, 1984, 1992) and Lundberg and Pollak ( 1996) have questioned the models and theories of family economics, in the light of empirical evidence of the unequal distribution of resources in the family. This has led them to question 'common preference' models, the price theory, assumptions of general competitive equilibrium, 'rational' behaviour and the concept of equality. The focus is on reshaping economic theory. It has not led to economists rethinking the concept of money as a universal, homogeneous commodity, defined by its functions as a means and unit of exchange and a store of value.

Many of the sociologists of family who have emphasised the management and control of money have also not questioned the nature of money. Debate has revolved around the relative influence of different socioeconomic factors on the management and control of money in marriage. Meredith Edwards ( 1981) distinguishes between money management and control. The management of finance, she says, 'is akin to the implementation functions performed within any enterprise--the carrying out of decisions which have already been made' (p. 4 ). Control, on the other hand, is 'the decision-making aspect of family finances. It is akin to the policy-making functions of any enterprise' ( Edwards 1981, p. 4). Control of money is an obvious illustration of power in the household. It must be remembered, however, as Lukes ( 1974) points out, that power is exercised also by 'influencing, shaping or determining . . . wants' (p. 23 ). Moreover, a person who has power over money in the household need not necessarily have greater power outside the household to determine the directions of his or her life.

Four different types of money management have been identified, based on access to money and responsibility for day-to-day spending on goods ( Edwards 1981, 1984a, 1984b; Morris 1990; Pahl 1989; Vogler & Pahl 1993; Wilson 1987a, 1987b). These are: the whole wage system; the household allowance; pooled or shared management; and independent management.

The whole wage system is one where the husband (most usually) hands over his pay packet to the wife to manage. Though it is at times not the whole wage packet, the central notion is that the man hands over his earnings in cash to the wife to provide for his family. The wife is responsible for all household expenditure. This money management system is most often found among lower-income families, where the management of money is often an onerous responsibility, with the wife having to stretch inadequate resources to meet family needs.

The household allowance system is one where the main earner gives a set amount to the other partner to cover housekeeping expenses. The rest of the money is controlled by the main earner. The woman may or may not know how much her husband earns ( Komarovsky 1962, p. 338; Morris 1990, pp. 111-12). This is most often found among middle-income couples, especially where the wife is not in paid work ( Edwards 1984b). In Woodville this is how Ian and Ingrid, who are now retired, continue to manage their money.

The independent management system is one where both partners have their own money and are responsible for different categories of expenditure. This aptly describes the way Kris and Korn manage their money. It is most often found in very high two-income households where husbands and wives pool only part of their money for household expenses.

The majority of couples studied in Woodville follow the pooled or shared management system, where both partners have equal access to all household income. The money is pooled, and responsibility for expenditure is shared. However, it is still possible for one partner to have greater control and influence over the way money is spent and budgeted. This pooling system is found where there is a relatively high income ( Pahl 1989), or among middle-income couples where the wife earns ( Edwards 1984b).

The pooled or shared system of money management and control is the system most commonly found in Britain, with about half the households in the 1980s sharing money management. There was more shared management in the 1980s than 30 years ago ( Pahl 1989). Looking more closely at the management and control of the pooled system, Vogler and Pahl ( 1993) found that only 20 per cent of the sample saw themselves as jointly managing their finances and only 39 per cent of the couples who pooled their money saw themselves as being jointly responsible for it. The other couples who pooled their income and expenditure saw the pool as being controlled by the husband or the wife.

Control of money as opposed to the management of money centres on decision-making on big ticket purchases and the ability to spend for personal needs. Four systems of control have been noted--wife control; husband control; shared control; and independent control, where husband and wife separately control their own money. These mimic in important ways the systems of money management corresponding to the whole wage system, housekeeping allowance, joint and independent systems. As seen above, the level of income is important for the way money is managed and controlled. The person who earns the money is most likely to control it. This is tempered with ideology and the relative levels of income earned by the husband and wife. Systems of money management and control have also been linked to life-stage ( Kassarjian 1982; Kirchler 1988). There is more joint financial decisionmaking among newlywed couples. When the first child is born, the husband's influence relative to the wife's increases. The wife's influence begins to rise as the children become independent, and is at its highest when the couple is without children.

Source: Marriage Money: The Social Shaping of Money in Marriage and Banking