Family Economics and Public Policy, 1800s-Present: How Laws, Incentives, and Social Programs Drive Family Decision-Making and the Us Economy

This volume will explore the relationship between government policy and family economic decision making from the 1800s through today, and how this relationship has contributed to the US economy at different stages. It will look at how families have responded to the incentives and the constraints established by diverse federal and state policies and laws, ranging from the regulation of marriage, to female labor force participation, to education and child labor policies, to social security, and more. It will also examine who allocates a family’s resources and how decisions are made that then determine each household’s unique participation in the market system. Most importantly, it will highlight how the interplay of public policy and family economic decision-making have driven our economy to be the most innovative, prosperous and unequal amongst the world’s developed economies, with looming crises such as social security funding, which will affect the US economy at a macro level as much as it will affect US families at a micro level. Finally, it will examine the ways in which the current government/family interplay needs to change in response to dramatic changes in the American family and the continued evolution of the US economy. As much as a strong legal system, enforced property rights, and a spirit of innovation drove the growth of the US economy in the last two centuries, American families have produced the people, endowed them with human capital and instilled in them a culture, for good or for bad, that made the growth possible. Many of the nagging problems affecting the US economy today, from a relative loss in human capital advantage over other countries, the persistence of inequality and an underclass, burgeoning entitlement spending, and low labor force participation rates, have solutions in policies that support (or incentivize) families. Many of the opportunities we face, from increasing the strength of the knowledge economy, using technology to improve living standards at home and abroad, becoming the leader in the ’greening ’of our industries and lifestyles require families to allocate their resources accordingly. At a time when American families are more complex than ever before, and the legitimacy of much public policy is being challenged, this volume will educate readers on the often unrecognized role that federal and state government policy has on our family lives, and the uncelebrated role family economic decision-making has on the future of the US economy.

Megan McDonald Way is Associate Professor and Chair of the Economics Division at Babson College, USA. She teaches graduate and undergraduate microeconomics principles and undergraduate labor courses. Her research focuses on intergenerational financial transfers within families, specifically how demographic changes in family structure are affecting the way money gets passed between the generations. She also studies gender earnings gaps, particularly among the self-employed. Prior to her career in academia, Dr. Way spent eight years as a marketing professional in the software industry.