Relative income and household income

A third and final reason for the difference between married and cohabiting couples could be the fact that the gender wage gap in marriages is usually greater than that in cohabitations.

The mean value of the relative earnings of the female partners is around 28 percent in the marriages and around 42 percent in the cohabitations. The gap is even larger if the median is taken into account. The married women earn approximately 23 percent and the unmarried women 43 percent of the total income of both partners. Heckert et al. (1998) have developed a typology to characterize partners’ distribution of earnings. They differentiate between “tra-ditional arrangements”, where she earns up to 25 percent of the total income, “new-tra“tra-ditional arrangements”, where she has a share of 25 to 50 percent of the total earnings, “non-tradtional arrangements”, where she earns 50 to 75 percent, and “reverse-traditional arrangements”, where she earns 75 to 100 percent of the total income. This typology can be applied to vari-ous other arrangements within couples, e.g. the division of hvari-ousework. In this sense, married couples predominantly have new-traditional patterns of earnings, while cohabitations almost always have a non-traditional allocation of incomes. Note that Heckert’s typology is related only to relative earnings of partners. Here, the use of these labels does not refer to specific gender role attitudes or to gender ideology.

020406080100Percent

Married Cohabiting

trad new non reverse trad new non reverse Her response

Control over income

Separated She

He Pool

Data source: SOEP 2004, 2005, and 2008 Data source: SOEP 2005 and 2008

Figure 5: Financial power outcomes and partners’ income ratio

often abandon the equity rule if there are large differences in income. In cohabitations with traditional or reverse-traditional income patterns, financial inequalities are more likely to be balanced out by the joint pool.

Two characteristics of marriages can be observed: the joint pool is most common in the tra-ditional couples, but less common in the reverse-tratra-ditional couples. Inequalities in earnings are only balanced in the marriages if the male partner earns much more, not if the female partner is the main breadwinner. This indicates that rather his income than her income is still perceived as the family income.

Surprisingly, the separate system is often used in the married and most often used in the cohab-iting couples if the partners’ earnings follow a new-traditional pattern. However, the separate system might have different implications for unmarried and married women. While almost two thirds of the unmarried women work in full-time positions, half of the married women work in part-time positions. One could argue that in addition to a lower relative income, the value of money (Zelizer, 2005) also depends on women’s employment status. Since married women more often have part-time employments, it is more likely that their incomes are con-sidered as the “secondary” and less important incomes. This money is often used for expenses for the household and children. Most other expenses are usually covered by the men’s “pri-mary” incomes (Roy, 2006). In cohabitations, where almost two thirds of the women work in full-time positions, the female partners’ income is more likely to be comparable to their male partners’ earnings. Here both incomes might have the value of primary incomes, even though the woman’s income is lower. This interpretation of the separate system has two implications for power in marriages and cohabitations: in cohabitations, the separate system might affect women’s control over finances less because the value of their money is comparable to that of their partners’ earnings. In marriage, however, the separate system excludes women from control over the “primary” income. Here, female partners only have control over the “sec-ondary” and thus less important money.

According to rational choice theory, it is to be expected that money is related to power. In point of fact, the partner with the higher income has exclusive control over finances. This is especially true for marriages with a reverse-traditional distribution of incomes: in almost 20 percent of the married couples, the female partners have sole control over the income. Her control is used nearly as often as the separate system.

The person with the higher income also has more decision-making power regarding financial issues – or, more precisely, is perceived to have decision-making power. The positive rela-tion between share of income and decision-making exists predominantly in the tradirela-tional and reverse-traditional couples – particularly if they are cohabiting. The unmarried women and men are more likely to possess decision-making power than their married counterparts. Fur-thermore, in the cohabitations with a non-traditional distribution of earnings it is the female partner who perceives herself as often having decision-making power. In the marriages, in contrast, the men are more often perceived to have power. The same holds true for couples with non-traditional income patterns. Again, this finding supports the assumption that gender role attitudes or gender ideologies underlie power allocation within couples and their per-ceptions of power. The financial power outcomes differ between the married and unmarried couples: the female partners are perceived to have a power advantage in the cohabitations rather than in the marriages.

020406080100Percent

1. tertile 2. tertile 3. tertile

Her response Control over income

Separated She

He Pool

Data source: SOEP 2004, 2005, and 2008

Figure 6: Control over the income and household income

According to findings by Pahl (1983) and Lott (2009), it is to be expected that there is gender inequality regarding the control over finances in different household income groups.

For lower income groups, we assume that women are more likely than men to manage the money. In these households, control over the income is a burden rather than a power factor. In order to highlight this difference the term “management” instead of “control” will be used for low income households. In the higher income group, the male partner is expected to control the money.

Figure 6 shows that there is a tendency that it is more often the female partners who manage the money in the lowest income group, whereas in the highest income groups it is more often the male partner who controls the money. These results support previous findings. In house-holds with more financial resources, he is less and she is more likely to control money, while she is in charge of money management in low-income households. However, one could argue that women have a higher relative salary in the lowest income group but earn less money than their partners in the highest income group. The relation observed between household income and control would then be due to the partners’ relative earnings. If we take into account the distribution of the partners’ incomes in the household groups and the mean values (Table 7), we see that actually the opposite situation is the case: she earns slightly more in the high-est income group and less in the lowhigh-est income groups.³⁷ Around 57 percent of the female partners in the lowest income group have a relative income lower than 25, as opposed to only 35 percent in the highest income group. Thus, according to rational choice theory we would expect that she is more likely to control the income in the highest income group and less likely in the lowest income group. However, as we saw in Figure 6, the relation between control and household income is the other way around – despite her relative income. Hence, in addition to the positive relation between power bases and power outcomes, gender inequality constitutes a further factor with regard to household income.

Household income (tertiles) Income ratio (her share), in % 1st 2nd 3rd

Traditional (0-25%) 57.72 50.43 35.41 New traditional (25-50%) 17.47 27.56 41.40 Non traditional (50-75%) 8.48 13.02 14.75 Reverse traditional (75-100%) 16.33 8.99 8.43

Mean 29.90 30.63 34.82

N 822 973 955

Note: Column percentages weighted with cross-sectional weight; N not weighted; Female respondents; Data source: SOEP 2004, 2005, and 2008

Table 7: Partners’ relative incomes in household income groups

37The same tendency can be observed in household income quintils. She earns more in the highest quintil.

Furthermore, her share of income is greater in the highest income group compared to lower incomes groups both in the sample for control over money as well as for decision-making. Weighted and unweighted results point into the same direction for teritles as well as quintiles.