Claudia Goldin’s Work is Foundational for Understanding 21st Century Families

The functions and activities of families continue to fascinate many social scientists. Families are a unique grouping of individuals, governed by different rules and expectations than other social attachments. 

In the past, discussions of family life were implicit rather than explicit among classical economists. Smith acknowledged the role of families as educators (1776). Malthus advocated population control via delayed marriage and reduced family size (1798). Mill thought women should have equal standing in marriages and in society more broadly (1859). In the early 20th century, F.A. Hayek discussed the different institutions that govern the “anonymous order,” or market, and the “intimate order,” or private relationships marked by altruism that are often present within the family. 

The formal economic study of families began with Gary Becker, who modeled the family as a small firm that benefits from specialization and exchange. This included the idea that efficient, and perhaps successful, partnerships involved one spouse who is more productive in market work and one spouse who is more productive in household work.

Though these ideas represented a revolutionary application of neoclassical economic theory to unconventional topics, Becker and other economists had to examine them under a new light as gender roles evolved. More and more women were entering the labor market, and the theory of marriage and family as specialization was not aligning with the real world. Did Becker’s theories, foundational to economists’ interest in the private world of family, reflect history? Would they remain relevant into the 21st century? Is it even possible to sum up what brings two people together?

Enter Claudia Goldin, investigative labor and gender economist, a student of Becker's at Chicago, the first woman to earn tenure in Harvard’s economics department, and the 2023 Nobel Laureate. She plays a critical role in the development of the questions Becker initiated, and she takes a different approach. Goldin’s work in economic history began on the topic of reconstruction-era economic development, which led her to recognize huge economic changes that were being driven by women and the work they did. Goldin’s career became focused on the transformation of women’s workforce involvement that occurred as the United States economy developed and continues to develop. 

Reading Goldin’s work has been informative to me in two ways. First, she has communicated the significance of the story of women’s labor force involvement, and demonstrated that the activities and function of family life cannot be separated from the trajectory of women. Second, she has set an example of interdisciplinary social science that incorporates the complexities of human life.

The role of women in the economy is changing; thus, families are changing

Goldin’s early work uses quantitative historical data to describe the how women’s roles in the economy have changed over time. In one of her first papers on the topic of gender in 1983, Goldin notes that economists and sociologists have concentrated on the causes of the changes in women’s roles and historians have focused on the effects. “The most immediate impact,” Goldin writes, “has been on the family itself.” The form and function of the family is a result of ideology, social norms, and micro-level expectations. Daily activities in the home look significantly different in a world where women specialize within the home than in a world where women specialize outside of the home and delay or forego having children. 

In her historical-investigative research, Goldin identified five major phases of work and family, discussed in her book Career and Family. The changing status of women in the workforce, along with new technologies, new norms, and new opportunities, transformed the day-to-day innerworkings of families. In the first half of the 20th century, women had jobs (distinct from careers) before they had families. These jobs were a means to supporting themselves or their parents and would often become unnecessary once she was married. The second phase is family—then job, in which women would seek employment after raising children. Starting around the 1970s, women wanted to begin establishing a career before having a family, which might have entailed more extensive education or training, and led to the delay of marriage and childbearing. The 21st century and the “modern family” are marked by women’s attempts to pursue a career and have children. 

Goldin is correct to call the transformation of women’s roles and the effects on family life “The Quiet Revolution.” The family has changed drastically in the past 100 years, and much of the transformation is linked to the responsibilities assigned to mothers. While there are obvious responsibilities that naturally fall on mothers, some tasks that can be accomplished by fathers, hired help, or machines (hello, microwave) are being shared as women experience more lucrative opportunities outside the home. People interested in the trajectory of the family will want to pay attention to the trajectory of women’s opportunities as they are intrinsically linked.

A “detective” approach to social science

Claudia Goldin describes her work as an economist as “detective” work. She asks big questions and seeks to understand them through a combination of quantitative and qualitative historical data. This is an appropriate methodology for understanding the actions of people, as opposed to other methods that place theory before investigation. 

Goldin contributes to social science on the topic of families by making observations based on history. The “Grand Gender Convergence” has affected the form and function of the family unit. The reasons why people team up to create a family have changed and appear to have outdated the economic theory of specialization. In the 21st century, it is as clear as ever that the myriad motivators of family formation cannot be simplified. 

A historical-investigative approach may uncover some trends, but more prominently, it will reveal the highly subjective nature of human decisions. Some people may marry for gains from productive specialization or other financial reasons, some for tradition or in accordance with their ideology. Some may be motivated by economies of scale in pooling living expenses, or by tax benefits, or by scientific research on the benefits of married parents for the development of children, not to mention love, devotion, envy, risk-aversion, or passion. Research on the topic of “marriage” will have different results across regions, cultures, and generations. 

Goldin models an approach to social science that is rooted first in observation. She then investigates what she observes, and finally digs around to uncover theories that could help explain what is happening. In this way, Goldin goes beyond Becker’s application of foundational price theory—costs, benefits, specialization—in understanding the family. She brings a historical lens to the topic, seeks to understand rather than to predict, and in doing so preserves the economist’s role as a student of society.

Families are heterogeneous like people. Some still own farms and family businesses. Some have access to birth control, some don’t, and some morally oppose its use. Some parents will enjoy staying home with children, and others really enjoy their careers. Those of us who are interested in understanding the function and activities of families will benefit from Goldin’s detective approach. We will be forced to narrow our scope, to be hesitant with generalizations, and to consider the influences and goals that make humans unique.

Goldin won the Nobel Prize in Economics for the way she investigated and communicated trends in women’s labor force decisions and outcomes, but this award brings questions related to family back to the forefront of social science. As we move away from gendered specialization in the production of home and market goods, our theories of why families exist, their functions in economic flourishing, and the way they are affected by economic institutions must be revisited and carried forward. 

Anna Claire Flowers is a PhD Fellow with the Mercatus Center and a Graduate Fellow with the F.A. Hayek Program for Advanced Study in Philosophy, Politics, and Economics.