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Efficiency In Intrahousehold Resource Allocation

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  • Fafchamps, Marcel

Abstract

This paper examines the allocation of productive resources within rural households of poor countries. Building upon the existing literature, it provides a consistent framework from which to study productive efficiency and intrahousehold equity. The topics discussed include returns to scale and household centralization; specialization and gender casting; separate spheres and commitment failure; labor market cartelization and discrimination; and the provision of home public goods in the presence of free riding. We show that intrahousehold productive inefficiency should not arise unless household members are prevented from entering into enforceable side contracts. Our analysis predicts that intrahousehold inefficiency increases with factors that exacerbate commitment failure such as short time horizon, low assets, unequal stakes in the household, and poor external enforcement. Patrimonial laws and customs regarding inheritance and divorce can be understood as efforts to mitigate commitment failure within the household.

Suggested Citation

  • Fafchamps, Marcel, 1998. "Efficiency In Intrahousehold Resource Allocation," FCND Discussion Papers 94856, CGIAR, International Food Policy Research Institute (IFPRI).
    • Handle: RePEc:ags:fcnddp:94856
    DOI: 10.22004/ag.econ.94856
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    Cited by:

    1. 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).
    2. Obayelu, A. E. & Afolami, Caroline A. & Agbonlahor, M.U., 2013. "Comparative Analysis of Resource Use Efficiency among Various Production Scale Operators in Cassava-Based Mixed Cropping Systems of Ogun and Oyo States of South west, Nigeria," 2013 Fourth International Conference, September 22-25, 2013, Hammamet, Tunisia 160123, African Association of Agricultural Economists (AAAE).
    3. Marcel Fafchamps & Agnes R. Quisumbing, 2003. "Social roles, human capital, and the intrahousehold division of labor: evidence from Pakistan," Oxford Economic Papers, Oxford University Press, vol. 55(1), pages 36-80, January.

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