Public-good valuation and intrafamily allocation
AbstractI derive the marginal value of a public good in multiperson households, measured alternatively by one household member’s willingness to pay (WTP) for the good on behalf of the household, or by the sum of individual WTP values across family members. Households are assumed to allocate their resources using efficient Nash bargains over two goods, one private good for each member, and one common household good. We show that with no altruism among two family members, member 1’s WTP on behalf of the household is on average a correct representation of true aggregate household WTP for the public good, and is higher (lower) than this average when member 1 has a higher (lower) marginal value of the public good than member 2. Nonpaternalistic altruism makes each of the two members’ WTP on behalf of the household closer to the true aggregate WTP. With paternalistic altruism, attached to consumption of the public good, higher altruism raises aggregate WTP. Higher altruism on the part of both members then moves individual-based WTP closer to true aggregate WTP, while the opposite may occur when only one member is altruistic.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Oslo University, Department of Economics in its series Memorandum with number 28/2002.
Length: 39 pages
Date of creation: 18 Jun 2003
Date of revision:
Contact details of provider:
Postal: Department of Economics, University of Oslo, P.O Box 1095 Blindern, N-0317 Oslo, Norway
Phone: 22 85 51 27
Fax: 22 85 50 35
Web page: http://www.oekonomi.uio.no/indexe.html
More information through EDIRC
Public goods; willingness to pay; contingent valuation; intrafamily allocation;
Other versions of this item:
- D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
- D64 - Microeconomics - - Welfare Economics - - - Altruism; Philanthropy
- H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
- Q26 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Recreational Aspects of Natural Resources
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Bartik, Timothy J., 1988.
"Evaluating the benefits of non-marginal reductions in pollution using information on defensive expenditures,"
Journal of Environmental Economics and Management,
Elsevier, vol. 15(1), pages 111-127, March.
- Timothy J. Bartik, 2008. "Evaluating the Benefits of Non-marginal Reductions in Pollution Using Information on Defensive Expenditures," Book chapters authored by Upjohn Institute researchers, in: Joseph Herriges & Catherine L. Kling (ed.), Revealed Preference Approaches to Environmental Valuation, volume 0, pages 459-475 W.E. Upjohn Institute for Employment Research.
- Muthoo,Abhinay, 1999. "Bargaining Theory with Applications," Cambridge Books, Cambridge University Press, number 9780521576475, April.
- Richard Carson & Nicholas Flores & Norman Meade, 2001.
"Contingent Valuation: Controversies and Evidence,"
Environmental & Resource Economics,
European Association of Environmental and Resource Economists, vol. 19(2), pages 173-210, June.
- Carson, Richard T & Flores, Nicholas A, 2000. "Contingent Valuation: Controversies and Evidence," University of California at San Diego, Economics Working Paper Series qt75k752s7, Department of Economics, UC San Diego.
- John Quiggin, 1998. "Individual and Household Willingness to Pay for Public Goods," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 80(1), pages 58-63.
- Shelly Lundberg & Robert Pollak, 2003.
"Efficiency in Marriage,"
Review of Economics of the Household,
Springer, vol. 1(3), pages 153-167, September.
- Carson, Richard T. & Hanemann, W. Michael, 2006. "Contingent Valuation," Handbook of Environmental Economics, in: K. G. Mäler & J. R. Vincent (ed.), Handbook of Environmental Economics, edition 1, volume 2, chapter 17, pages 821-936 Elsevier.
- Zhiqi Chen & Frances Woolley, 1999.
"A Cournot-Nash Model of Family Decision Making,"
Carleton Economic Papers
99-13, Carleton University, Department of Economics, revised Oct 2001.
- Jones-Lee, M W, 1991. " Altruism and the Value of Other People's Safety," Journal of Risk and Uncertainty, Springer, vol. 4(2), pages 213-19, April.
- Browning, M. & Chiappori, P.A., 1994.
"Efficient Intra-Household allocations: A General Characterization and Empirical Tests,"
DELTA Working Papers
94-16, DELTA (Ecole normale supérieure).
- M. Browning & P. A. Chiappori, 1998. "Efficient Intra-Household Allocations: A General Characterization and Empirical Tests," Econometrica, Econometric Society, vol. 66(6), pages 1241-1278, November.
- Martin Browning & P.A. Chiappori, 1996. "Efficient Intra-Household Allocations - A General Characterization and Empirical Tests," Discussion Papers 96-10, University of Copenhagen. Department of Economics.
- Martin Browning & Pierre-Andre Chiappori, 1994. "Efficient Intra-Household Allocations: a General Characterization and Empirical Tests," Department of Economics Working Papers 1994-02, McMaster University.
- McElroy, Marjorie B & Horney, Mary Jean, 1981. "Nash-Bargained Household Decisions: Toward a Generalization of the Theory of Demand," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 22(2), pages 333-49, June.
- Johansson, Per-Olov, 1994. "Altruism and the value of statistical life: Empirical implications," Journal of Health Economics, Elsevier, vol. 13(1), pages 111-118, March.
- Lundberg, S. & Pollak, R.A., 1991.
"Separate Spheres Bargaining and the Marriage Market,"
Discussion Papers in Economics at the University of Washington
91-08, Department of Economics at the University of Washington.
- Lundberg, Shelly & Pollak, Robert A, 1993. "Separate Spheres Bargaining and the Marriage Market," Journal of Political Economy, University of Chicago Press, vol. 101(6), pages 988-1010, December.
- Lundberg, S. & Pollak, R.A., 1991. "Separate Spheres Bargaining and the Marriage Market," Working Papers 91-08, University of Washington, Department of Economics.
- Saku Aura, .
"Does the balance of power within a family matter? The case of the Retirement Equity Act,"
202, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
- Aura, Saku, 2005. "Does the balance of power within a family matter? The case of the Retirement Equity Act," Journal of Public Economics, Elsevier, vol. 89(9-10), pages 1699-1717, September.
- Saku Aura, 2002. "Does the Balance of Power Within a Family Matter? The Case of the Retirement Equity Act," CESifo Working Paper Series 734, CESifo Group Munich.
- Siwan Anderson, 2000.
"The Economics of Roscas and Intra-Household Resource Allocation,"
Econometric Society World Congress 2000 Contributed Papers
1323, Econometric Society.
- Siwan Anderson & Jean-Marie Baland, 2002. "The Economics Of Roscas And Intrahousehold Resource Allocation," The Quarterly Journal of Economics, MIT Press, vol. 117(3), pages 963-995, August.
- Anderson, K.S. & Baland, J-M., 2000. "The Economics of Roscas and Intra-Household Resource Allocation," Discussion Paper 2000-83, Tilburg University, Center for Economic Research.
- Bergstrom, T.C., 1993.
"A Survey of Theories of the Family,"
93-02, Michigan - Center for Research on Economic & Social Theory.
- Quiggin, John, 1992. "Risk, self-protection and ex ante economic value--some positive results," Journal of Environmental Economics and Management, Elsevier, vol. 23(1), pages 40-53, July.
- Jones-Lee, M W, 1992. "Paternalistic Altruism and the Value of Statistical Life," Economic Journal, Royal Economic Society, vol. 102(410), pages 80-90, January.
- Carlsson, Fredrik & He, Haoran & Martinsson, Peter & Qin, Ping & Sutter, Matthias, 2010.
"Household Decision Making in Rural China: Using Experiments to Estimate the Influences of Spouses,"
IZA Discussion Papers
5127, Institute for the Study of Labor (IZA).
- Carlsson, Fredrik & He, Haoran & Martinsson, Peter & Qin, Ping & Sutter, Matthias, 2012. "Household decision making in rural China: Using experiments to estimate the influences of spouses," Journal of Economic Behavior & Organization, Elsevier, vol. 84(2), pages 525-536.
- Carlsson, Fredrik & He, Haoran & Martinsson, Peter & Qin, Ping & Sutter, Matthias, 2010. "Household Decision Making in Rural China: Using Experiments to Estimate the Influences of Spouses," Working Papers in Economics 465, University of Gothenburg, Department of Economics.
- Fredrik Carlsson & Haoran He & Peter Martinsson & Ping Qin & Matthias Sutter, 2010. "Household Decision Making in Rural China: Using Experiments to Estimate the Influences of Spouses," Working Papers 2010-20, Faculty of Economics and Statistics, University of Innsbruck.
- Jon Strand, 2005.
"Individual and Household Values of Mortality Reductions with Intrahousehold Bargaining,"
Journal of Risk and Uncertainty,
Springer, vol. 31(2), pages 217-236, September.
- Strand, Jon, 2009. "Individual and household value of mortality reductions with intrahousehold bargaining," HERO On line Working Paper Series 2004:2, Oslo University, Health Economics Research Programme.
- Liam Delaney & Francis O’Toole, 2006. "Willingness to pay: individual or household?," Journal of Cultural Economics, Springer, vol. 30(4), pages 305-309, December.
- Marcella Veronesi & Martina Menon & Federico Perali, 2007. "Extensions of the Traditional Travel Cost Model of Non-Market Valuation to a Collective Framework: Evidence from the Field," Working Papers 42/2007, University of Verona, Department of Economics.
- Eline Aas, 2009. "Pecuniary compensation increases participation in screening for colorectal cancer," Health Economics, John Wiley & Sons, Ltd., vol. 18(3), pages 337-354.
- Tuan, Tran Hu & Lindhjem, Henrik, 2008.
"Meta-analysis of nature conservation values in Asia & Oceania: Data heterogeneity and benefit transfer issues,"
11470, University Library of Munich, Germany.
- Tran Huu Tuan & Henrik Lindhjem, 2008. "Meta-analysis of nature conservation values in Asia & Oceania: Data heterogeneity and benefit transfer issues," EEPSEA Research Report rr2008072, Economy and Environment Program for Southeast Asia (EEPSEA), revised Jul 2008.
- Henrik Lindhjem & Ståle Navrud, 2009. "Asking for Individual or Household Willingness to Pay for Environmental Goods?," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 43(1), pages 11-29, May.
- Yang, Xiaojun & Carlsson, Fredrik, 2012. "Intra-household decisions making on intertemporal choices: An experimental study in rural China," Working Papers in Economics 537, University of Gothenburg, Department of Economics.
- Liam Delaney & Francis O'Toole, 2007.
"Individual, Household and Gender Preferences for Social Transfers,"
200703, Geary Institute, University College Dublin.
- Delaney, Liam & O'Toole, Francis, 2008. "Individual, household and gender preferences for social transfers," Journal of Economic Psychology, Elsevier, vol. 29(3), pages 348-359, June.
- Udo Ebert, 2013. "The relationship between individual and household measures of WTP and WTA," Social Choice and Welfare, Springer, vol. 40(2), pages 367-390, February.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Rhiana Bergh-Seeley).
If references are entirely missing, you can add them using this form.