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Does Measurement Error Explain a Paradox About Household Size and Food Demand? Evidence from Variation in Household Survey Methods

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  • Gibson, John

Abstract

Several recent papers report a puzzling pattern of food demand falling as household size rises at constant per capita expenditure, especially in poorer countries. This pattern is contrary to a widely used model of scale economics. This paper exploits within-country differences in household survey methods and interviewer practices to provide a measurement error interpretation of this puzzle. A comparison of household surveys in Cambodia and Indonesia with the results from Monte Carlo experiments suggest that food expenditure estimates from shorter, less detailed recall surveys have measurement errors that are correlated with household size. These correlated measurement errors contribute to the negative effect of household size on food demand and cause upward bias in Engel estimates of household scale economies.

Suggested Citation

  • Gibson, John, 2003. "Does Measurement Error Explain a Paradox About Household Size and Food Demand? Evidence from Variation in Household Survey Methods," 2003 Annual meeting, July 27-30, Montreal, Canada 22198, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea03:22198
    DOI: 10.22004/ag.econ.22198
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    References listed on IDEAS

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    1. François Gardes & Christophe Starzec, 2000. "Economies of scale and food consumption: A reappraisal of the Deaton-Paxson paradox," Post-Print halshs-03721665, HAL.
    2. Lanjouw, Peter & Ravallion, Martin, 1995. "Poverty and Household Size," Economic Journal, Royal Economic Society, vol. 105(433), pages 1415-1434, November.
    3. Andrew Chesher & Christian Schluter, 2002. "Welfare Measurement and Measurement Error," Review of Economic Studies, Oxford University Press, vol. 69(2), pages 357-378.
    4. John Gibson, 2002. "Why Does the Engel Method Work? Food Demand, Economies of Size and Household Survey Methods," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 64(4), pages 341-359, September.
    5. Dreze, Jean & Srinivasan, P. V., 1997. "Widowhood and poverty in rural India: Some inferences from household survey data," Journal of Development Economics, Elsevier, vol. 54(2), pages 217-234, December.
    6. Behrman, Jere R. & Foster, Andrew D. & Rosenzweig, Mark R., 1997. "The dynamics of agricultural production and the calorie-income relationship: Evidence from Pakistan," Journal of Econometrics, Elsevier, vol. 77(1), pages 187-207, March.
    7. Bound, John & Brown, Charles & Mathiowetz, Nancy, 2001. "Measurement error in survey data," Handbook of Econometrics, in: J.J. Heckman & E.E. Leamer (ed.), Handbook of Econometrics, edition 1, volume 5, chapter 59, pages 3705-3843, Elsevier.
    8. François Gardes & Christophe Starzec, 2000. "Economies of scale and food consumption: A reappraisal of the Deaton-Paxson paradox," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-03721665, HAL.
    9. Angus Deaton & Christina Paxson, 1998. "Economies of Scale, Household Size, and the Demand for Food," Journal of Political Economy, University of Chicago Press, vol. 106(5), pages 897-930, October.
    10. Li Gan & Victoria Vernon, 2003. "Testing the Barten Model of Economies of Scale in Household Consumption: Toward Resolving a Paradox of Deaton and Paxson," Journal of Political Economy, University of Chicago Press, vol. 111(6), pages 1361-1377, December.
    11. Gibson, John, 2002. "Why Does the Engel Method Work? Food Demand, Economies of Size and Household Survey Methods," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 64(4), pages 341-359, September.
    12. Gardes, F. & Starzec, C., 2000. "Economies of Scale and Food Consumption : a Reappraisal of the Deaton-Paxson Paradox," Papiers d'Economie Mathématique et Applications 2000.08, Université Panthéon-Sorbonne (Paris 1).
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    1. Berendeeva, Ekaterina & Ratnikova, Tatiana, 2016. "The Deaton–Paxson paradox in the consumption of Russian households," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 42, pages 54-74.

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