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Out of the Wallet and into the Purse: Using Micro Data to Test Income Pooling

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  • Jennifer Ward-Batts

    (Claremont McKenna College)

Abstract

Unitary models, assuming a single objective function and unified budget constraint, are traditionally used to model household behavior. Most empirical tests of unitary models rely on endogenous regressors. This paper uses an exogenous change in the intrahousehold distribution of income, provided by a change in U.K. Family Allowance policy. Expenditure shares are estimated for a wide range of goods. Shifts in expenditure shares for assignable goods, such as men’s clothing, children’s clothing, and men’s tobacco, suggest that children benefited at the expense of men when this policy change shifted income within households from men to women.

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Bibliographic Info

Paper provided by Claremont Colleges in its series Claremont Colleges Working Papers with number 2003-10.

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Date of creation: May 2003
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Handle: RePEc:clm:clmeco:2003-10

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Keywords: income pooling; intrahousehold allocation; child benefit; collective model; unitary model; family policy; household demand;

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  16. Lundberg, S. & Pollak, R.A., 1991. "Separate Spheres Bargaining and the Marriage Market," Working Papers 91-08, University of Washington, Department of Economics.
  17. Alderman, H. & Chiappori, P.A. & Haddad, L., 1994. "Unitary versus Collective Models of the Household: Time to Shift the Burden of Proof?," DELTA Working Papers 94-17, DELTA (Ecole normale supérieure).
  18. Lundberg, S.J. & Pollak, R.A. & Wales, T.J., 1994. "Do Husbands and Wives Pool Their Resources? Evidence from U.K. Child Benefit," Working Papers 94-6, University of Washington, Department of Economics.
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