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Health and Retirement Effects in a Collective Consumption Model of Older Households

  • Aline Bütikofer

    (University of Bern)

  • Arthur Lewbel


    (Boston College)

  • Shannon Seitz

    (Boston College)

Using data on elderly individuals and couples, we estimate a collective model of household consumption of a variety of goods, showing how resources are shared between husband and wife, and how this allocation is affected by retirement and health status. We identify the extent to which shared consumption of some goods by elderly married couples reduces their costs of living relative to living alone. We also identify the fraction of household resources consumed by wives versus husbands, taking this jointness of some consumption into account. The results are relevant for household bargaining models and for a variety of welfare calculations.

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Paper provided by Boston College Department of Economics in its series Boston College Working Papers in Economics with number 767.

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Date of creation: 15 Dec 2010
Date of revision: 15 Jan 2011
Handle: RePEc:boc:bocoec:767
Contact details of provider: Postal: Boston College, 140 Commonwealth Avenue, Chestnut Hill MA 02467 USA
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  1. Mariacristina De Nardi & Eric French & John Bailey Jones, 2005. "Differential mortality, uncertain medical expenses, and the saving of elderly singles," Working Paper Series WP-05-13, Federal Reserve Bank of Chicago.
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