IDEAS home Printed from https://ideas.repec.org/a/wly/ajagec/v103y2021i4p1251-1267.html
   My bibliography  Save this article

Intrahousehold Economies of Scale with Application to Food Assistance and Work Incentive Programs

Author

Listed:
  • Wenying Li
  • Jeffrey H. Dorfman

Abstract

Comparing income levels across families with different household compositions and sizes is not easy and has been a long‐term focus in welfare and policy analysis. This paper evaluates the extent childless two‐person households in the U.S. reduce their costs by living together relative to living alone. Using a structural collective household model and household scanner data, we find women, on average, consume 48% of total household expenditures, and a woman (man) living alone would need approximately 65% (63%) of the two‐person household's income to reach the same living standard as attained as a member of a two‐person household. Our results suggest the poverty line for two‐person childless households may need to be increased, whereas other federal benefit calculations are overly generous.

Suggested Citation

  • Wenying Li & Jeffrey H. Dorfman, 2021. "Intrahousehold Economies of Scale with Application to Food Assistance and Work Incentive Programs," American Journal of Agricultural Economics, John Wiley & Sons, vol. 103(4), pages 1251-1267, August.
    • Handle: RePEc:wly:ajagec:v:103:y:2021:i:4:p:1251-1267
    DOI: 10.1111/ajae.12187
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/ajae.12187
    Download Restriction: no
    File URL: https://libkey.io/10.1111/ajae.12187?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Laurian Unnevehr & James Eales & Helen Jensen & Jayson Lusk & Jill McCluskey & Jean Kinsey, 2010. "Food and Consumer Economics," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 92(2), pages 506-521.
    2. Martin Browning & Pierre-André Chiappori & Arthur Lewbel, 2013. "Estimating Consumption Economies of Scale, Adult Equivalence Scales, and Household Bargaining Power," Review of Economic Studies, Oxford University Press, vol. 80(4), pages 1267-1303.
    3. Blaylock, James R. & Smallwood, David M., 1986. "An Alternative Approach To Defining And Assessing Poverty Thresholds," Western Journal of Agricultural Economics, Western Agricultural Economics Association, vol. 11(1), pages 1-6, July.
    4. Attanasio, Orazio & Di Maro, Vincenzo & Lechene, Valérie & Phillips, David, 2013. "Welfare consequences of food prices increases: Evidence from rural Mexico," Journal of Development Economics, Elsevier, vol. 104(C), pages 136-151.
    5. M. Browning & P. A. Chiappori, 1998. "Efficient Intra-Household Allocations: A General Characterization and Empirical Tests," Econometrica, Econometric Society, vol. 66(6), pages 1241-1278, November.
    6. Tsakloglou, Panos, 1991. "Estimation and Comparison of Two Simple Models of Equivalence Scales for the Cost of Children," Economic Journal, Royal Economic Society, vol. 101(405), pages 343-357, March.
    7. Frederic Vermeulen, 2002. "Collective Household Models: Principles and Main Results," Journal of Economic Surveys, Wiley Blackwell, vol. 16(4), pages 533-564, September.
    8. Browning, Martin & Francois Bourguignon & Pierre-Andre Chiappori & Valerie Lechene, 1994. "Income and Outcomes: A Structural Model of Intrahousehold Allocation," Journal of Political Economy, University of Chicago Press, vol. 102(6), pages 1067-1096, December.
    9. Helen H. Jensen, 2002. "Food Insecurity and the Food Stamp Program," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 84(5), pages 1215-1228.
    10. Menon, Martina & Pendakur, Krishna & Perali, Federico, 2012. "On the expenditure-dependence of children’s resource shares," Economics Letters, Elsevier, vol. 117(3), pages 739-742.
    11. Sabates, Ricardo & Gould, Brian W. & Villarreal, Hector J., 2001. "Household composition and food expenditures: a cross-country comparison," Food Policy, Elsevier, vol. 26(6), pages 571-586, December.
    12. Harding, Matthew & Lovenheim, Michael, 2017. "The effect of prices on nutrition: Comparing the impact of product- and nutrient-specific taxes," Journal of Health Economics, Elsevier, vol. 53(C), pages 53-71.
    13. Rueben C. Buse & Larry E. Salathe, 1978. "Adult Equivalent Scales: An Alternative Approach," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 60(3), pages 460-468.
    14. Geoffrey R. Dunbar & Arthur Lewbel & Krishna Pendakur, 2013. "Children's Resources in Collective Households: Identification, Estimation, and an Application to Child Poverty in Malawi," American Economic Review, American Economic Association, vol. 103(1), pages 438-471, February.
    15. Browning,Martin & Chiappori,Pierre-André & Weiss,Yoram, 2014. "Economics of the Family," Cambridge Books, Cambridge University Press, number 9780521795395, January.
    16. James Banks & Richard Blundell & Arthur Lewbel, 1997. "Quadratic Engel Curves And Consumer Demand," The Review of Economics and Statistics, MIT Press, vol. 79(4), pages 527-539, November.
    17. Lewbel, Arthur & Pendakur, Krishna, 2008. "Estimation of collective household models with Engel curves," Journal of Econometrics, Elsevier, vol. 147(2), pages 350-358, December.
    18. Shelley A. Phipps, 1998. "What Is The Income "Cost Of A Child"? Exact Equivalence Scales For Canadian Two-Parent Families," The Review of Economics and Statistics, MIT Press, vol. 80(1), pages 157-164, February.
    19. Capacci, Sara & Mazzocchi, Mario, 2011. "Five-a-day, a price to pay: An evaluation of the UK program impact accounting for market forces," Journal of Health Economics, Elsevier, vol. 30(1), pages 87-98, January.
    20. Chiappori, Pierre-Andre, 1992. "Collective Labor Supply and Welfare," Journal of Political Economy, University of Chicago Press, vol. 100(3), pages 437-467, June.
    21. Mark G. Brown & S. R. Johnson, 1984. "Equivalent Scales, Scale Economies, and Food Stamp Allotments: Estimates from the Nationwide Food Consumption Survey, 1977–78," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 66(3), pages 286-293.
    22. Krishna Pendakur, 2018. "Welfare analysis when people are different," Canadian Journal of Economics, Canadian Economics Association, vol. 51(2), pages 321-360, May.
    23. Rossella Calvi, 2020. "Why Are Older Women Missing in India? The Age Profile of Bargaining Power and Poverty," Journal of Political Economy, University of Chicago Press, vol. 128(7), pages 2453-2501.
    24. Bargain, Olivier & Donni, Olivier, 2012. "Expenditure on children: A Rothbarth-type method consistent with scale economies and parents' bargaining," European Economic Review, Elsevier, vol. 56(4), pages 792-813.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Joshua Berning & Caroline Norris & Rebecca Cleary, 2023. "Food insecurity among immigrant populations in the United States," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 15(1), pages 41-57, February.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Echeverría, Lucía, 2020. "Modelos colectivos de consumo y distribución intra-hogar. Teoría y aplicaciones," Nülan. Deposited Documents 3832, Universidad Nacional de Mar del Plata, Facultad de Ciencias Económicas y Sociales, Centro de Documentación.
    2. Lin, Xirong, 2023. "Food demand and cash transfers: A collective household approach with Homescan data," Journal of Economic Behavior & Organization, Elsevier, vol. 212(C), pages 233-259.
    3. Lewbel, Arthur & Lin, Xirong, 2022. "Identification of semiparametric model coefficients, with an application to collective households," Journal of Econometrics, Elsevier, vol. 226(2), pages 205-223.
    4. Brown, Caitlin & Calvi, Rossella & Penglase, Jacob, 2021. "Sharing the pie: An analysis of undernutrition and individual consumption in Bangladesh," Journal of Public Economics, Elsevier, vol. 200(C).
    5. Calvi, Rossella & Penglase, Jacob & Tommasi, Denni & Wolf, Alexander, 2023. "The more the poorer? Resource sharing and scale economies in large families," Journal of Development Economics, Elsevier, vol. 160(C).
    6. Tommasi, Denni, 2019. "Control of resources, bargaining power and the demand of food: Evidence from PROGRESA," Journal of Economic Behavior & Organization, Elsevier, vol. 161(C), pages 265-286.
    7. Donni, Olivier & Molina, José Alberto, 2018. "Household Collective Models: Three Decades of Theoretical Contributions and Empirical Evidence," IZA Discussion Papers 11915, Institute of Labor Economics (IZA).
    8. Olivier Bargain & Guy Lacroix & Luca Tiberti, 2021. "Intrahousehold Resource Allocation and Individual Poverty: Assessing Collective Model Predictions against Direct Evidence on Sharing," Working Papers hal-03432676, HAL.
    9. Cherchye, Laurens & Cosaert, Sam & De Rock, Bram & Kerstens, Pieter Jan & Vermeulen, Frederic, 2018. "Individual welfare analysis for collective households," Journal of Public Economics, Elsevier, vol. 166(C), pages 98-114.
    10. Denni Tommasi & Alexander Wolf, 2016. "Overcoming Weak Identification in the Estimation of Household Resource Shares," Working Papers ECARES ECARES 2016-12, ULB -- Universite Libre de Bruxelles.
    11. Anderson VIL, 2023. "Children Costs in a One-Headed Household: Empirical Evidence from the UK," THEMA Working Papers 2022-21, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
    12. Krishna Pendakur, 2018. "Welfare analysis when people are different," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 51(2), pages 321-360, May.
    13. Olivier Bargain, 2022. "Income Sources, Intra-Household Allocation And Individual Poverty," Commitment to Equity (CEQ) Working Paper Series 121, Tulane University, Department of Economics.
    14. Wilman J. Iglesias & Alexandre B. Coelho, 2020. "Poverty and inequality within Brazilian households: an application of a collective consumption model," Empirical Economics, Springer, vol. 58(4), pages 1923-1952, April.
    15. Laurens CHERCHYE & Thomas DEMUYNCK & Bram DE ROCK, 2010. "Noncooperative household consumption with caring," Working Papers of Department of Economics, Leuven ces10.34, KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven.
    16. Arthur Lewbel & Krishna Pendakur, 2021. "Estimating A Model of Inefficient Cooperation and Consumption in Collective Households," Boston College Working Papers in Economics 1048, Boston College Department of Economics.
    17. Botosaru, Irene & Muris, Chris & Pendakur, Krishna, 2023. "Identification of time-varying transformation models with fixed effects, with an application to unobserved heterogeneity in resource shares," Journal of Econometrics, Elsevier, vol. 232(2), pages 576-597.
    18. Geoffrey R. Dunbar & Arthur Lewbel & Krishna Pendakur, 2021. "Identification of Random Resource Shares in Collective Households Without Preference Similarity Restrictions," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 39(2), pages 402-421, March.
    19. Senay Sokullu & Christine Valente, 2022. "Individual consumption in collective households: Identification using repeated observations with an application to PROGRESA," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 37(2), pages 286-304, March.
    20. Ulugbek Aminjonov & Olivier Bargain & Maira Colacce & Luca Tiberti, 2022. "Culture, Intra-household Distribution and Individual Poverty," Working Papers - Economics wp2022_21.rdf, Universita' degli Studi di Firenze, Dipartimento di Scienze per l'Economia e l'Impresa.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:ajagec:v:103:y:2021:i:4:p:1251-1267. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://doi.org/10.1111/(ISSN)1467-8276 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.