Collective consumption models with restricted bargaining weights: an empirical assessment based on experimental data
AbstractWe use experimental data to analyze consumption decisions by groups of individuals who have to reach a consensus on spending a joint budget. Our experiment involves dyads (i.e. two-member groups) who have to compose consumption bundles consisting of three commodities (wine, orange juice and M&Ms). We focus on the collective consumption model to describe group behavior. This model represents group decisions as Pareto optimal outcomes of a within-group bargaining process, with rational group members who are each characterized by individual bargaining weights. We also consider specifications of the collective model that restrict the variation of these bargaining weights. A distinguishing feature of our study is that we use revealed preference testing tools to assess the goodness-of-fit and discriminatory power of alternative specifications of the collective model. Our experimental results suggest that the most appropriate model specification allows for a limited variation of the bargaining weights. Copyright The Author(s) 2012
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Bibliographic InfoArticle provided by Springer in its journal Review of Economics of the Household.
Volume (Year): 10 (2012)
Issue (Month): 3 (September)
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Web page: http://www.springerlink.com/link.asp?id=109451
Pareto efficiency; Collective consumption decisions; Revealed preferences; Experimental data; Bargaining weights; C14; C92; D11; D12; D13;
Other versions of this item:
- Bruyneel, Sabrina & Cherchye, Laurens & De Rock, Bram, 2012. "Collective consumption models with restricted bargaining weights: an empirical assessment based on experimental data," Open Access publications from Katholieke Universiteit Leuven urn:hdl:123456789/308138, Katholieke Universiteit Leuven.
- C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Semiparametric and Nonparametric Methods: General
- C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
- D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
- D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
- D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
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- Bruyneel, Sabrina & Cherchye, Laurens & Cosaert, Sam & De Rock, Bram & Dewitte, Siegfried, 2012.
"Are the smart kids more rational?,"
Open Access publications from Katholieke Universiteit Leuven
urn:hdl:123456789/370786, Katholieke Universiteit Leuven.
- Sam COSAERT & Thomas DEMUYNCK, 2013.
"Revealed preference theory for finite choice sets,"
Center for Economic Studies - Discussion papers
ces13.08, Katholieke Universiteit Leuven, Centrum voor Economische Studiën.
- Cosaert, Sam & Demuynck, Thomas, 2013. "Revealed preference theory for finite choice sets," Open Access publications from Katholieke Universiteit Leuven urn:hdl:123456789/399983, Katholieke Universiteit Leuven.
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