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Distributional effects in household models: separate spheres and income pooling

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Author Info
Martin Browing
Pierre-Andre Chiappori
Valerie Lechene

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Abstract

We derive distributional effects for a non-cooperative alternative to the unitary model of household behaviour. We consider the Nash equilibria of a voluntary contributions to public goods game. Our main result is that, in general, the two partners either choose to contribute to different public goods or they contribute to at most one common good. The former case coresponds to the separate spheres case of Lundberg and Pollak (1993). The second outcome yields (local) income pooling. A household will be in different regimes depending on the distribution of income within the household. Any bargaining model with this non-cooperative case as a breakdown point will inherit the local income pooling. We conclude that targeting benefits such as child benefits to one household member may not always have an effect on outcomes.

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Paper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number 293.

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Date of creation: 2006
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Handle: RePEc:oxf:wpaper:293

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Keywords: Nash Equilibrium Nash Bargaining Collective Models Intra-Household Allocation

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Find related papers by JEL classification:
D10 - Microeconomics - - Household Behavior - - - General
C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

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References listed on IDEAS
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.:
  1. Kemp, Murray C., 1984. "A note of the theory of international transfers," Economics Letters, Elsevier, vol. 14(2-3), pages 259-262. [Downloadable!] (restricted)
  2. Valerie Lechene & Ian Preston, 2005. "Household Nash Equilibrium with Voluntarily Contributed Public Goods," Economics Series Working Papers 226, University of Oxford, Department of Economics. [Downloadable!]
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  3. 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. [Downloadable!] (restricted)
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  4. Warr, Peter G., 1983. "The private provision of a public good is independent of the distribution of income," Economics Letters, Elsevier, vol. 13(2-3), pages 207-211. [Downloadable!] (restricted)
  5. Richard Blundell & Pierre-André Chiappori & Costas Meghir, 2005. "Collective Labor Supply with Children," Journal of Political Economy, University of Chicago Press, vol. 113(6), pages 1277-1306, December. [Downloadable!] (restricted)
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  6. Bergstrom, Theodore & Blume, Lawrence & Varian, Hal, 1986. "On the private provision of public goods," Journal of Public Economics, Elsevier, vol. 29(1), pages 25-49, February. [Downloadable!] (restricted)
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(explanations, 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.)

  1. Martin Browing & Pierre-Andre Chiappori & Valerie Lechene, 2006. "Quelques resultats sur l`effet des transferts cibles," Economics Series Working Papers 294, University of Oxford, Department of Economics. [Downloadable!]
  2. Melanie Lührmann & Jürgen Maurer, 2008. "Who wears the trousers? A semiparametric analysis of decision power in couples," MEA discussion paper series 08168, Mannheim Research Institute for the Economics of Aging (MEA), University of Mannheim. [Downloadable!]
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