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Neighbourhood Effects in Consumption: Evidence from Disaggregated Consumption Data

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  • Teodora Boneva

Abstract

This paper identifies neighbourhood effects in consumption using the randomized nature of the Progresa programme. Recent studies establish that the programme affects the consumption of both eligible and neighbouring ineligible households but the underlying mechanism of the spillovers is not fully understood. I use disaggregated consumption data to distinguish between changes in consumption which result from changes in neighbourhood consumption and changes in consumption which are a result of income transfers between households. Using a flexible demand model that accounts for total expenditure, prices and household characteristics, I find that neighbourhood consumption has a substantial effect on household consumption choices

Suggested Citation

  • Teodora Boneva, 2013. "Neighbourhood Effects in Consumption: Evidence from Disaggregated Consumption Data," Cambridge Working Papers in Economics 1328, Faculty of Economics, University of Cambridge.
  • Handle: RePEc:cam:camdae:1328
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    References listed on IDEAS

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    More about this item

    Keywords

    Social interactions; consumption; field experiments; Progresa;

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • I38 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Government Programs; Provision and Effects of Welfare Programs
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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