Personality Traits, Household Dynamics, and Child Development

This dissertation studies the role of personality as a fundamental driver of household behavior across three domains: intra-household allocations, marital dynamics, and child development. The first chapter investigates how personality traits influence the allocation of resources within couples. Using Dutch survey data and a structural collective household model, I show that personality operates both as a taste shifter and as a distribution factor: spouses' personalities systematically shape preferences and bargaining power, thereby contributing to inequality in consumption within families. The second chapter examines how personality affects marriage, including joint consumption, labor specialization, and divorce. Relying on Australian panel data and estimating a dynamic collective model of marriage and divorce with limited commitment, personality enters the household child-production function, the match-quality process, and labor-market productivity. Counterfactual simulations indicate that specialization, risk-sharing, and bargaining are the primary channels through which personality shapes marital behavior. The third chapter focuses on the role of parental personality for child skill formation. Using U.S. data and a life-cycle model of parental investments, I show that personality shapes both time and monetary inputs as well as the quality of parent-child interactions. The results suggest that differences in parental personality generate persistent skill gaps among children, and that policies which ignore the productivity of these interactions risk unintended consequences for child development. Taken together, the three chapters demonstrate that personality is an economically consequential factor shaping relevant life-cycle dynamics related to household decisions, marital stability, and the transmission of skills.