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Category: Society

The Economics of Caretaking

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Written by Olivia Long on 3.30.21

An article in The Economist recently discussed an issue that economists have long tried to grapple with: how to calculate the monetary value of caretaking work, such as child care and housekeeping. They pointed to a ruling in a Chinese court where a man was ordered to pay his wife nearly $8000 as compensation for her unpaid labor at home during their 5-year marriage. Many Chinese women on social media decried the low amount, pointing to it as a warning against giving up employment outside the home during marriage, while the very fact that the court officially placed a value on this labor to be paid by the husband, as one of the primary beneficiaries of the wife’s work, was a surprise to many.

A divorce case in England in 2020 resulted in an equal split of a £10 million estate—but an additional payment of £400,000 was ordered to be paid to the wife for giving up her lucrative career as a solicitor in order to care for the couple’s children and home.

Such cases are rare—but they do illustrate the way in which academics and the legal system alike are grappling with the fact that the economic productivity that we have traditionally measured is possible in great part due to tremendous foundation of unpaid labor on which it rests. Riane Eisler is an historian and attorney whose extensive research in this field led her to write the book The Real Wealth of Nations in 2007. In this book she posits that the work of so many people, often women, is undervalued or dismissed entirely, leading us to misunderstand our economic present and hampers our ability to plan for a robust economy of the future that benefits us all.

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