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Families as roommates: Changes in U.S. household size from 1850 to 2000

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  • Alejandrina Salcedo
  • Todd Schoellman
  • Michèle Tertilt

Abstract

Living arrangements have changed enormously over the last two centuries. While the average American today lives in a household of only three people, in 1850 household size was twice that figure. Further, both the number of children and the number of adults in a household have fallen dramatically. We develop a simple theory of household size where living with others is beneficial solely because the costs of household public goods can be shared. In other words, we abstract from intra-family relations and focus on households as collections of roommates. The model's mechanism is that rising income leads to a falling expenditure share on household public goods, which endogenously makes household formation less beneficial and privacy more attractive. To assess the magnitude of this mechanism, we first calibrate the model to match the relationship between household size, consumption patterns, and income in the cross-section at the end of the 20th century. We then project the model back to 1850 by changing income. We find that our proposed mechanism can account for 37 percent of the decline in the number of adults in a household between 1850 and 2000, and for 16 percent of the decline in the number of children.
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  • Alejandrina Salcedo & Todd Schoellman & Michèle Tertilt, 2012. "Families as roommates: Changes in U.S. household size from 1850 to 2000," Quantitative Economics, Econometric Society, vol. 3(1), pages 133-175, March.
  • Handle: RePEc:ecm:quante:v:3:y:2012:i:1:p:133-175 DOI: QE76
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    Cited by:

    1. Doepke, M. & Tertilt, M., 2016. "Families in Macroeconomics," Handbook of Macroeconomics, Elsevier.
    2. Jeremy Greenwood & Nezih Guner & Georgi Kocharkov & Cezar Santos, 2016. "Technology and the Changing Family: A Unified Model of Marriage, Divorce, Educational Attainment, and Married Female Labor-Force Participation," American Economic Journal: Macroeconomics, American Economic Association, pages 1-41.
    3. Raül Santaeulàlia-Llopis & Yu Zheng, 2017. "Why Is Food Consumption Inequality Underestimated? A Story of Vices and Children," Working Papers 969, Barcelona Graduate School of Economics.
    4. Rosa Aisa & Joaquín Andaluz & Gemma Larramona, 2017. "Fertility patterns in the Roma population of Spain," Review of Economics of the Household, Springer, vol. 15(1), pages 115-133, March.
    5. David de la Croix & Faustine Perrin, 2016. "French Fertility and Education Transition: Rational Choice vs. Cultural Diffusion," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2016007, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    6. Underwood, Anthony & Zahran, Sammy, 2015. "The carbon implications of declining household scale economies," Ecological Economics, Elsevier, vol. 116(C), pages 182-190.
    7. Xi Chen, 2017. "Old age pension and intergenerational living arrangements: a regression discontinuity design," Review of Economics of the Household, Springer, vol. 15(2), pages 455-476, June.
    8. Bick, Alexander & Choi, Sekyu, 2013. "Revisiting the effect of household size on consumption over the life-cycle," Journal of Economic Dynamics and Control, Elsevier, vol. 37(12), pages 2998-3011.
    9. Michelle Rendall & Fatih Guvenen, 2009. "Emancipation through Education," 2009 Meeting Papers 70, Society for Economic Dynamics.
    10. Schünemann, Johannes & Strulik, Holger & Trimborn, Timo, 2017. "The marriage gap: Optimal aging and death in partnerships," ECON WPS - Vienna University of Technology Working Papers in Economic Theory and Policy 04/2017, Vienna University of Technology, Institute for Mathematical Methods in Economics, Research Group Economics (ECON).
    11. Fatih Guvenen & Michelle Rendall, 2015. "Women's Emancipation through Education: A Macroeconomic Analysis," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 18(4), pages 931-956, October.
    12. Christoph Winter, 2014. "Accounting for the Changing Role of Family Income in Determining College Entry," Scandinavian Journal of Economics, Wiley Blackwell, pages 909-963.
    13. Anders Fremstad & Anthony Underwood & Sammy Zahran, 2016. "The Environmental Impact of Sharing: Household and Urban Economies in CO2 Emissions," Working Paper Series 2016-01, Dickinson College, Department of Economics.
    14. Luca Pensieroso & Alessandro Sommacal, 2017. "Agriculture to Industry: the End of Intergenerational Coresidence," Working Papers 10/2017, University of Verona, Department of Economics.
    15. Chen, Xi, 2015. "Old-Age Pension and Intergenerational Living Arrangements," IZA Discussion Papers 9482, Institute for the Study of Labor (IZA).
    16. Anders Fremstad, 2014. "Gains from Sharing: Sticky Norms, Endogenous Preferences, and the Economics of Shareable Goods," UMASS Amherst Economics Working Papers 2014-02, University of Massachusetts Amherst, Department of Economics.

    More about this item

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • E1 - Macroeconomics and Monetary Economics - - General Aggregative Models
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • N30 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - General, International, or Comparative
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development

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