The Economics of Family Life

I’m middle aged. Like most of my friends I care simultaneously for children in school and aging parents at home. The older my children get the more important economics becomes. They don’t live in my home anymore but I continue to help pay for their schooling. I pay for dinners, trips and other activities too depending on whether they’re in the same city as me. Sorry kids, I take that back. Better I should say there has always been an economic dimension to our relationship, going back to my first purchase of baby formula, but the economic is not dominant. Our relationship is dominated by affection, memory, shared values and reciprocity. In other words, we form a community – an intimate community, a family.

The same is true of my parents. They turn 89 and 90 this year and they don’t live with me either. Yes, there is an economic dimension to our relationship but it’s not the most important dimension. When I change my father’s clothes or remember for my mother her best friend’s name, I am acting out a familial role that is older than human settlement on the Canadian Prairie. We are being family, one to another.

In formal economics the most common elements of nature, like water and air, are described as ‘externalities’. That is, they are external to the formal economic model and are treated as if they were free. They already exist, you don’t have to buy them and they exist in abundance. That’s true in the abstract but not in the world we inhabit. In the world of you and me, air and water are provided through plants, trees and the hydrologic cycle. They belong to all of Creation and they have very real limits. Indeed, we are bumping up against those limits so frequently, that we are challenging our neighbours to plant more trees, burn less fossil fuels and use water more carefully. Treating air and water as external to the economy is a major threat to our survival.

In formal economic models, families are also treated as ‘external’. They exist, you don’t need to buy them and they exist in abundance. But that’s not really true either. In the world of you and me, lots of families are broken and all the adults have jobs or want them. Very little time is left over for volunteer activity. If we want people to take on the job of care giver to the elderly, we have to pay them.

Now my parents prefer to be cared for at home. They are healthier, more settled, more connected and less confused than they would be in an alternative environment. Besides, they prefer their own bad cooking to someone else’s bad cooking! They have care and it’s paid for.

Air and water may be external to economic models but they are not external to how we breathe or what we drink. In the same way families are not external to how we live or who we care for. Economics are not the most important dimension of family life but neither can it be ignored. If we pretend it doesn’t exist, we won’t survive.


First Published in May 2005