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Income And Outcomes - A Structural Model Of Intrahousehold Allocation

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  • BROWNING, M
  • BOURGUIGNON, F
  • CHIAPPORI, PA
  • LECHENE, V

Abstract

There is evidence from several sources that one cannot treat many-person households as a single decision maker. If this is the case, then factors such as the relative incomes of the household members may affect the final allocation decisions made by the household. We develop a method of identifying how ''incomes affect outcomes'' given conventional family expenditure data. The basic assumption we make is that household decision processes lead to efficient outcomes. We apply our method to a sample of Canadian couples with no children. We find that the final allocations of expenditures on each partner depend significantly on their relative incomes and ages and on the level of lifetime wealth.

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File URL: http://discovery.ucl.ac.uk/16866/1/16866.pdf
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Bibliographic Info

Paper provided by University College London in its series Open Access publications from University College London with number http://discovery.ucl.ac.uk/16866/.

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Date of creation: Dec 1994
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Publication status: Published in J POLIT ECON (1994-12) v.102, p.1067-1096
Handle: RePEc:ner:ucllon:http://discovery.ucl.ac.uk/16866/

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Web page: http://www.ucl.ac.uk

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  1. François BOURGUIGNON & Martin BROWNING & Pierre-André CHIAPPORI & Valérie LECHENE, 1993. "Intra Household Allocation of Consumption: A Model and some Evidence from French Data," Annales d'Economie et de Statistique, ENSAE, issue 29, pages 137-156.
  2. 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).
  3. Blundell, Richard & Pashardes, Panos & Weber, Guglielmo, 1993. "What Do We Learn About Consumer Demand Patterns from Micro Data?," American Economic Review, American Economic Association, vol. 83(3), pages 570-97, June.
  4. Gregory, Allan W & Veall, Michael R, 1985. "Formulating Wald Tests of Nonlinear Restrictions," Econometrica, Econometric Society, vol. 53(6), pages 1465-68, November.
  5. Blundell, Richard William, 1987. "Econometric Approaches to the Specification of Life-Cycle Labour Supply and Commodity Demand Behaviour," CEPR Discussion Papers 150, C.E.P.R. Discussion Papers.
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