The Price, Cost, Consumption and Value of Children
AbstractThough they are related, the price, cost, consumption and value of children are not the same. This paper explores two aspects of the relationship between these concepts. Even if we restrict attention to the domain of commodity consumption, the cost of children is not the same as children's consumption. In this context, the cost of children to their parents is often described with a consumer equivalence scale. It is shown here that, under reasonable assumptions, children's consumption of market goods is less than the 'equivalent income' of the household, but more than the 'cost of children'. Expenditure costs, however, are only part of the cost of children. This paper uses a variant of the 'adult goods' method to estimate the full costs of children, including both expenditure and time costs. Adult personal time (comprising pure leisure, sleep and other personal care) is used as the adult good. Preliminary estimates using Australian data suggest a very large cost of children. The paper discusses the limitations of the estimation approach and considers the broader welfare implications of these costs.
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Bibliographic InfoPaper provided by EconWPA in its series Labor and Demography with number 0402003.
Date of creation: 12 Feb 2004
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Consumer equivalence scales Time use Children's consumption Cost of children Adult goods;
Other versions of this item:
- Bruce Bradbury, 2004. "The Price, Cost, Consumption and Value of Children," Labor and Demography 0411001, EconWPA.
- J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
- J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
- I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
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