Risk-sharing, savings and intrahousehold distribution of assets in Indonesia

This dissertation is about the analysis of household survey data from Indonesia. The Indonesia Family Life Survey (IFLS) is mainly used to test theories about household behaviors. In particular, I focus on these issues with respect to savings and risk-sharing behaviors and their relationship to the intrahousehold distribution of assets.;The first of these issues is concerned with the role of community linkage for risk-sharing and examines the difference in the degree of risk-sharing among Indonesian households between those actively participating in community activities and those not doing so. This is measured by per capita consumption trends in the face of idiosyncratic health shocks to the head of the household. The results show that community participants are better insured against the health crises of the head of household than are non-participants. It implies that those who are not involved in community networks are more vulnerable to unpredictable shocks.;The second study examines the difference in the perception and report of household assets between married partners and finds that the presence or absence of the spouse at the time of report plays a significant role in this difference. A main finding is the downward effect of spousal presence on the values reported by the respondent for certain types of assets such as jewelry and monetary savings. This observation can be explained by the respondent's strategic motivation so as not to reveal personal assets to the spouse. It implies that, in the context of household decision making models, non-cooperative models with imperfect contractability and asymmetric information between household members are more realistic than unitary or cooperative household models, which assume complete information between partners.;The third study explores the determinants of the female partner's participation in Rotating Savings and Credit Associations (ROSCAs). The results show that the intrahousehold distribution of assets has a systematic influence on wife's participation. The relationship is hump-shaped. In particular, the increase in the participation rate at lower levels of wife's share in household assets, on the one hand, is explained by the increase in the demand for savings as her relative power rises. On the other hand, its decline at higher levels of the share in assets can be explained by the increase in benefits or attractiveness of alternative savings devices. These effects cannot be predicted by conventional "unitary household models".