Marriage and Consumption
AbstractWe examine theoretically and empirically consumption over the early part of the life-cycle. The main focus is on the transition from being single to living with someone else. Our theoretical model allows for publicness in consumption; uncertainty concerning marriage; differences between lifetime incomes for prospective partners and a marriage premium. We develop a two period model to bring out the main features of the impact of marriage on consumption and saving. We then develop a multi-period model that can be taken to the data on expenditures by singles and couples aged between 18 and 30. Our empirical work is based on individual based quasi-panels from UK expenditure survey data from 1978 to 2005. The model fits the data relatively well. We find that expenditure by couples leads to 20-40 % more consumption than the same expenditure split between two comparable singles.
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Bibliographic InfoPaper provided by University of Copenhagen. Department of Economics. Centre for Applied Microeconometrics in its series CAM Working Papers with number 2009-07.
Length: 16 pages
Date of creation: Mar 2009
Date of revision:
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Web page: http://www.econ.ku.dk/CAM/
More information through EDIRC
marriage; consumption; saving; family economics; economies of scale;
Find related papers by JEL classification:
- D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
- D91 - Microeconomics - - Intertemporal Choice - - - Intertemporal Household Choice; Life Cycle Models and Saving
- J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-04-13 (All new papers)
- NEP-BEC-2009-04-13 (Business Economics)
- NEP-LAB-2009-04-13 (Labour Economics)
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.:
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