Asymmetry of Information within Family Networks

De Weerdt, J., Genicot, G. & Mesnard, A. (2017). Asymmetry of Information within Family Networks. Journal of Human Resources,

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Abstract

This paper studies asymmetry of information and transfers within 712 extended family networks from Tanzania. Using cross-reports on asset holdings, we construct measures of mis-perception of living standards among households within the same network. We contrast altruism, pressure, exchange and risk sharing as motives to transfer in simple models with asymmetric information. Testing the model predictions in the data uncovers the active role played by recipients of transfers. Our findings suggest that recipients set the terms of the transfers, either by exerting pressure on donors or because they hold substantial bargaining power in their exchange relationships.

Item Type: Article
Uncontrolled Keywords: Asymmetric Information, Transfers, Pressure, Exchange, Altruism
Divisions: School of Social Sciences > Department of Economics
URI: http://openaccess.city.ac.uk/id/eprint/18459

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