This paper examines the effect of living in violent and precarious environments on intra-household decision making dynamics. While current literature on household bargaining abound about the effects of intra-household factors such as education and income on a woman’s decision-making power, studies exploring the impact of extra-household parameters remain sparse. Drawing from the non-unitary household bargaining model, external environmental factors like the conditions of an individual’s living environment are in fact crucial shift parameters of a woman’s bargaining power. Subsequently, this paper uses municipal homicide rate data from the National Institute for Statistics and Geography (INEGI) as a proxy for unsafe living conditions in Mexico, and exploits the fortuitous overlap in timing of the three-wave Mexican Family Life Survey (MxFLS), which provides detailed information on a woman’s intra-household decision-making power. The sudden and plausibly exogenous rise in homicides between 2007-2011 due to the Mexican Drug War provides a source of variation in the data as it coincides with the third wave of the MxFLS. To estimate the relationship between homicides and a woman’s relative decision-making power, I employ two distinct empirical strategies, an individual fixed effects model and difference-in-differences which both follow an intent-to-treat approach. Overall, results from the former method reveal a decline in a woman’s relative bargaining power over public and collective consumption goods which include children’s. Interestingly, estimates from the latter model suggest an increase in a wife’s relative decision-making power over her husband’s private goods and a simultaneous decline in her relative bargaining power over her own private goods in the face of a violent milieu. Altogether these findings point to several possible mechanisms such as fear, mistrust, protection and lower labor force participation, which potentially govern the relationship between dangerous living environments and a woman’s relative intra-household bargaining power.

Audrey is a second year Ph.D. in Economics student at the Ludwig Maximilian University of Munich. Her research interests pertain to family, household and development economics with a main focus on gender-related topics.

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This paper could also be classified under general gender research.