Caring and Sharing: Tests Between Alternative Models of Intra-household Allocation
AbstractSeveral models of intra-household decision making have been suggested in the literature. We present a framework that includes all suggested models and variants as special cases. We derive the theoretical predictions of these models for the relationship between expenditures on goods and the intra-household distribution of income. We estimate and test between these relationships using Canadian household expenditure data. We conclude that there is evidence that both husbands and wives care for each other in the sense that with an unequal distribution of incomes the high income partner behaves as a `Becker dictator' and there is local income pooling. We further find that for about half of the households in our sample (those with more equal incomes) a re-distribution of income would lead to changes in budget allocations. We conclude that the data are consistent with a collective model with caring partners.
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Bibliographic InfoPaper provided by University of Copenhagen. Department of Economics in its series Discussion Papers with number 01-07.
Length: 41 pages
Date of creation: Apr 2001
Date of revision:
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Intra-household Allocation; Altruism; Cooperative Behaviour; Non Cooperative Behaviour;
Other versions of this item:
- Valerie Lechene & Martin Browning, 2001. "Caring and Sharing: Tests Between Alternative Models of Intra-Household Allocation," Economics Series Working Papers 70, University of Oxford, Department of Economics.
- D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
This paper has been announced in the following NEP Reports:
- NEP-ALL-2001-10-22 (All new papers)
- NEP-MFD-2001-10-22 (Microfinance)
- NEP-MIC-2001-10-22 (Microeconomics)
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