In East Asia, extended families were dissolved by rapid economic development. Despite rapid economic growth since the 1980s, India has seen little change in the prevalence of nuclear families. Why is this? The answer lies in the kind of economic development India has experienced.

Indians tend to work for small family-owned businesses. This pattern of structural transformation and occupational diversification has strengthened multigenerational households.

By caring for each other, extended families provide crucial support. India is not unusual, given its level of income. Intergenerational co-residence remains common in many developing countries.

Unlike East Asia, Indian extended families are just as common in cities and villages. Urban couples are no more likely to live alone. Educational expansion is not driving change either. Less than 50% of male graduates form independent households – as detailed by Etienne Breton.

Nuclear households by husband’s age and education, India 1983-2009.
Nuclear households by husband’s age and place of residence, India 1983-2009.

Economic factors

Regular employment remains exceptional, across South Asia. Lacking job security or social insurance, families may prefer to pool resources and create their own safety net. Strong kinship ties endure partly because they provide consumption-smoothing insurance.

So we might expect intergenerational co-residence to wane with economic development – as suggested by this graph by Dante Sanchez Torres. India is not unusual for its level of income.

So is India likely to follow the Western model of nuclear families? Possibly, but I am not sure. The prevalence of nuclear-living has remained constant in India, despite three decades of economic growth.

I suggest that intergenerational co-residence prevails alongside growth partly because strong family bonds encourage family businesses and low female employment, which in turn strengthen family ties.

Strong family bonds

Families are incredibly important in India. They live together, run businesses, and support each other through hard times. For centuries, sons have lived with their parents, inherited land, continued the lineage and performed ancestral rites. Kinship is intensive, especially in the north – where joint families are four times more common than the south. This fosters a strong cultural preference for intergenerational co-residence.

Demographic change also matters. As fertility falls and life expectancy increases, men have fewer siblings and are thus more likely to live with their (longer surviving) parents.

But demography and kinship intensity cannot fully explain persistence because East Asian countries shared these conditions yet nevertheless became more nuclear. In 1900, almost all Chinese, Japanese, Korean and Taiwanese families were extended. But with economic development, non-familial employment, and urbanisation, East Asians increasingly want to live separately. Adults still perform filial piety, but through remittances rather than co-residence.

Low female employment

Over the twentieth century, Japanese, South Korean, Taiwanese, and Chinese women increasingly migrated to work for factories and offices. The dual-earner model enhanced young couples’ economic independence.

Rural-urban migration is much lower in India. Moreover, female employment is low and falling.

This is partly a coordination problem. Families would benefit financially from women’s employment, and the opportunity cost of staying at home has increased as women have fewer children.

But fear of social sanction outweighs these economic rewards. In India’s kin-orientated milieu, rumours of female promiscuity jeopardise families’ social standing, deterring deviation from traditional norms of purity and propriety.

Meanwhile, the poorest and most desperate, lower-caste families sacrifice social respect for barebones survival. Female employment in South Asia is thus associated with deprivation. Women – especially in rural areas – gain status by withdrawing from the labour market, a striking similarity with Western Europe in the early phases of the Industrial Revolution. And even if rural women want to work, opportunities are dwindling due to the mechanisation of agriculture.

In many ways South Asia is marred in a “Gender Perception Trap”. Men predominate in socially valued domains. This reinforces widespread stereotypes that male workers are more competent –
which in turn fuels gender wage gaps. Women’s relatively meagre earnings may not seem worthwhile given the risk of tainting family honour.

But urban college graduates women do respond to economic opportunities in information technology, telecoms, finance, and hospitality. Respectable employment does not jeopardise family status. City women rarely quit their jobs when their families become wealthier. They gain social esteem through career success. But their employment is curbed by low demand. Low female employment constrains young couples’ economic independence.

Moreover, if women are not going out for work, broadening their networks, they remain more rooted in the family. Older women without economic independence are especially reliant on their sons. All this encourages intergenerational co-residence.

One group is increasingly forming nuclear households – the poorest landless labourers. Speculatively, this is probably because they have no property to inherit, scant support from equally poor kin and higher rates of female employment. This lowers the opportunity cost of independent living.

Most Indians work for small firms

The vast majority of India’s manufacturing workers are employed in small enterprises. This has not changed with economic development.

Number of workers by firm size and type (millions)

Small firms are a major employer in India, as contrast with East and South East Asia.

Share of manufacturing employment by enterprise size (%)

If you just look at one sector, apparel, small firms are far more common in India than China.

From 1983 to 2009, the proportion of college graduates working for family businesses increased from 18% to 32%. Meanwhile those on independent salaries actually fell: from 73% to 58%.

Importantly, college graduates working for a family business are less likely to form their own homes.

Nuclear households by husband’s occupation and education, young couples, India 1983-2009.

Family employment is encouraged by the tax system. The Hindu Unified Family is a legal entity, taxed only once. The entity includes all men descended from a common ancestor, their wives, and unmarried daughters. Members of such an entity are not taxable for monies they receive as part of the Hindu Unified Family. Work for outsiders and pay more tax.

If men continue to live and work for their families, kinship prospers with economic growth.

Meanwhile South Korea and Japan developed via large firms. President Park Chung-hee directed foreign finance to large “chaebols”, which continue to be major employers. Workers forged class consciousness on the factory floor and salarymen showed their dedication to the company. The mode of production enabled non-familial association.

Chronic shortage of housing

Indian housing is incredibly expensive, relative to incomes. For pukka housing, young couples may be better off with in-laws.

Given low female employment and unaffordable housing, Indian couples often lack the economic independence to start their own homes. Men remain with their kin – whose long-standing cultural importance is underpinned by family businesses.

Older patriarchs remain in control

Indian women living with in-laws tend to have less autonomy over their own health, mobility and purchases, less freedom of movement, and lower labour force participation.

This holds controlling for age, education, caste, rural/urban location, year of marriage, and state – as Sulagna Mookerjee shows in the table below.

Wives of younger sons have a lower rank in the family and worse maternal nutrition. This thwarts their children’s development.

It’s difficult to disentangle causality but there seems to be a feedback loop.

Indian women’s economic independence is heavily constrained. Given poor labour market prospects, women may be better off living with in-laws. Once under their roof, women have less autonomy and are less likely to seek non-familial employment. As women age, they become economically dependent upon sons. This solidifies family ties over generations.

This effect is heightened in North India, where women typically move to their husband’s village, so forgo their natal support system, have even less autonomy, lack independent incomes, so become especially reliant on sons.

Indians tend to be employed in small-family owned businesses. This pattern of structural transformation has strengthened multigenerational households.

Alice Evans is a Lecturer at King’s College London, a Faculty Associate at Harvard CID, with previous appointments at Cambridge and the LSE. This article first appeared on her website.