Maria Sophia Aguirre, Ph. D

Download 222.43 Kb.
Date conversion14.05.2016
Size222.43 Kb.
1   2   3   4   5   6

Table 1

How does the Family Fit in the Economy?

Basic Activities

Means Used

Role of the Family



Resources and


Human Capital

Basic Needs



Human, Moral, Social Capital

Income and Profit


Buying power and Distribution

Appropriate distribution



In order to obtain the income or retribution for their contribution of resources, each person and/or institution need to exchange. This exchange takes place in the market.11 In order for the market to last, a necessity to exchange and some basic economic institutional and structural conditions, such as competitive terms of trade or openness to trade, need to exist. It also requires other fundamental features such as trust, communication, order, and political stability need to be present as well.12 It is for this reason that human, moral, and social capitals play a fundamental role.13 How and which goods and services get produced and how those contributing with their resources are paid depend on the choices made by those producing them. When income and profit are not obtained, the production is typically stopped and often, corrupted structures of individuals and institutions take over.14

To consume, one needs first to obtain goods and services. To obtain these goods and services, one needs buying power and a distribution system that will allow consumers to reach them. The distribution of buying power typically takes place through income and profits, but it is redistributed. There are three ways this transfer from one person to another takes place: by voluntary payments, by theft, or through taxes and benefits organized by the government. In addition to history, nature, and luck, each player in the economy influences how the redistribution will take place by the way they behave and the way they vote.15 Thus, for an appropriate distribution to take place, i.e., for this distribution to actually meet the needs of the family and by doing so to contribute to both the welfare and wellbeing of its members, a fair and equitable distribution system for goods and for buying power are fundamental. It is within the family and through its influence that it exercises in the decision process of individuals, that this appropriate distribution is ensured or disrupted.16

The grounds on which capitalist theories have defended private property have been the economic agent's work. These theories propose that because it is a given economic agent who carries out work, he is therefore the owner of it. Thus, they conclude, he has the right to keep and enjoy its fruits. However, this justification is incomplete, since no one could work having not first received some type of education and/or training. Furthermore, no one can work without the help of others. Thus, to same extent, any input of production or product, is not the economic agent's alone. Other members of that society have rights upon the same product, beginning by the members of his family. This implies that while it is possible to find support for the right to private property based on a person's work, it does not mean that this right is absolute. Private property encourages production and belongs to someone, but the product of this property transcends the owner since he does not work in isolation or for himself alone.

Using the previous analysis, we can understand why several elements of the economy degenerate if they are not ordered towards the family: What is the motivation to work without a family? What is the point of an economic agent saving or investing beyond retirement (i.e. future consumption) or even death without the family? What moderation would there be in consumption and spending if there were no family? What is the role of government if not to meet, at least in a subsidiary manner, the needs of the family? An economy that is based exclusively on profit and selfish individualism could be successful for a period of time, but it would not last (among other things because it will not produce enough population which without, no economy is possible). It is man, the economic agent, that works, and he naturally belongs to a family. Since it is also the case that man develops within the family, then it follows that he, as the economic agent, will be better fitted to contribute the most to society and vice versa when the family is being promoted by the economy in which he works.

So far we have seen that family consumption needs give rise to economic activity, and that the families affect economic production, exchange, and consumption by the influence that it exercises on each of its members. At the same time, as the members of these families contribute to the economy, private property and other institutions and services such as factories, health and hospitality services, housing, education, social securities, national security, etc., develop so as to complement and meet the needs of these families. Therefore, if we are to understand any economic issue, the way in which that given issue affects the family as a whole or a given member of it must be evaluated carefully. This is directly and indirectly the most important reason for economic activity.

III. Socioeconomic Implications

Today, there is a large body of scientific evidence that clearly indicates human beings develop in the best way within a family that is functional, i.e., with his biological or adoptive mother and father in a stable marriage.17 The academic and social performance of a child is very closely related to the structure of the family in which he lives and this is important for the quality of the human and social capital.18 The psychological stability and health of a child is closely related to healthy families and this is important for worker’s productivity and government finances.19

Social science research also shows that the breakdown of the family is a symptom of a sick and weak society. Women abuse is twenty five times more likely to occur in irregular families20 and children abuse is six times higher.21 Men who have witnessed domestic violence are three times more likely to abuse their own wives and children.22 Non-maternal care increases children’s aggressive and violent behavior23 and substance abuse and teen-age pregnancy are higher in broken families.24

In addition, a broken family breeds poverty. Families, women and children of broken families, have a higher probability of living in poverty.25 Figure 1 to 3 present the percentage of families, women, and children in poverty by race and family structure for the U.S. In all cases single parents are significantly worse off than marriage couples. This is especially revealing, as with the case of the U.S. one can make a parallel between races and levels of education and income. In general, whites are better educated and have a higher income than blacks. Hispanics, on the other hand, often not only do not command the language but they are illegal. This is reflected on their level of education and income.

1   2   3   4   5   6

The database is protected by copyright © 2016
send message

    Main page