The Internal Organization of the Family: Economic Analysis and Psychological Advice

Abstract

In this article, I suggest that the advice (informal rules) provided by clinical psychologists for allocating and enforcing entitlements within families reflects sound economic judgement. Economics and clinical psychology appear to be as far apart as is possible for two fields concerned with human behavior. Unlike the imperialistic encroachment of economic theory into law and politics and the symbiotic relationship between evolutionary biology and game theory, the intellectual intersection between economics and clinical psychology has been non-existent. Part of the explanation is methodological. In contrast to economics, books providing psychological advice have no theorems and few statistics. Even their fellow psychologists in cognitive and social psychology criticize the clinical approach for being non-scientific and non-experimental. And above all, clinical psychology appears to deal with ‘irrational’ behavior of individuals. Hence, it should not be at all surprising that economics and clinical psychology have had little overlap. Despite the apparent gulf between these two fields, I will show that, in practice, the advice given by marriage and family counselors regarding behavior within the family is consistent with economic thinking and in some ways is more advanced. Ultimately, this is a more satisfying relationship between the two disciplines – one theory of human psychology is better than two theories. If economists correctly believe that people are rational, then the help that rational people get from their psychologists and from popular psychology books should be consistent with rationality, especially so since patients can apply the advice and see whether it works in practice. In the following pages, I show that clinical psychologists who employ codependency theory use the same conceptual apparatus as economists: rationality, choice, property rights, and fixity of preferences (or emotions). I argue that the