COVID-19, crises and women's control of resources: Evidence from Mexico

This paper investigates the effect of crises on the intra-household allocation of resources. To study this issue, I use survey data from Mexico and estimate a structural model of household behavior to recover how much resources are allocated to each household member. Then, I construct a proxy for women's bargaining power using the women's control of resources and document how it evolves over periods of economic stability and contraction. The results suggest that during the COVID-19 crisis period, women's control of resources decreased relative to the non-recession period (4-5 percentage points) and the financial crisis (6-8 percentage points). This effect was more pronounced for households with children than those without children. Finally, I look into how this resource reallocation affects household consumption and individual poverty. The results of this paper highlight the heterogeneous behavior of intra-household inequality and women's bargaining power over the business cycle. It also suggests that the hypothesis that the financial crisis was a "man-cession" and the COVID-19 crisis was a "she-cession" holds in terms of intra-household resource allocation.