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Intra-Household Allocation of Resources: Inferences from Non-Resident Fathers’ Child Support Payments

  • Ermisch, John

    ()

    (University of Oxford)

  • Pronzato, Chiara D.

    ()

    (University of Turin)

A large proportion of divorced and separated fathers form new partnerships. The new partner’s preferences are not likely to put much weight on expenditures on the man’s children from his previous union. Thus, his own and his partner’s income would have different impacts on his child support payments if partners’ relative incomes affect bargaining power in household decisions. This paper exploits within-father variation in the British Household Panel Survey (1991-2003) to estimate the impacts of intra-household income distribution on child support payments and the father’s welfare. We find that a higher share of father’s income in household income increases the probability of paying child support and its amount relative to household income.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2498.

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Length: 32 pages
Date of creation: Dec 2006
Date of revision:
Publication status: published in: Economic Journal, 2008, 118 (527), 347-362
Handle: RePEc:iza:izadps:dp2498
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  1. Martin Browning & Pierre-Andre Chiappori, 1994. "Efficient Intra-Household Allocations: a General Characterization and Empirical Tests," Department of Economics Working Papers 1994-02, McMaster University.
  2. Chiappori, Pierre-André & Fortin, Bernard & Lacroix, Guy, 2001. "Marriage Market, Divorce Legislation and Household Labor Supply," Cahiers de recherche 0103, Université Laval - Département d'économique.
  3. Chiappori, P.A., 1989. "Collective Labour Supply and Welfare," DELTA Working Papers 89-07, DELTA (Ecole normale supérieure).
  4. Browning, M. & Bourguignon, F. & Chiappori, P.A. & Lechene, V., 1992. "Incomes and Outcomes: A structural Model of Intra-Household Allocation," DELTA Working Papers 92-23, DELTA (Ecole normale supérieure).
  5. Iftikhar Hussain, 2006. "Consumer Demand and the Role of Labour Supply and Durables," Economic Journal, Royal Economic Society, vol. 116(510), pages C110-C129, 03.
  6. Kaushik Basu, 2006. "Gender and Say: a Model of Household Behaviour with Endogenously Determined Balance of Power," Economic Journal, Royal Economic Society, vol. 116(511), pages 558-580, 04.
  7. Browning, Martin & Meghir, Costas, 1991. "The Effects of Male and Female Labor Supply on Commodity Demands," Econometrica, Econometric Society, vol. 59(4), pages 925-51, July.
  8. Weiss, Yoram & Willis, Robert J, 1985. "Children as Collective Goods and Divorce Settlements," Journal of Labor Economics, University of Chicago Press, vol. 3(3), pages 268-92, July.
  9. Yoram Weiss & Robert J. Willis, . "Transfers Among Divorced Couples: Evidence and Interpretation," University of Chicago - Population Research Center 90-4a, Chicago - Population Research Center.
  10. Deaton, Angus S & Muellbauer, John, 1980. "An Almost Ideal Demand System," American Economic Review, American Economic Association, vol. 70(3), pages 312-26, June.
  11. Marcos A. Rangel, 2006. "Alimony Rights and Intrahousehold Allocation of Resources: Evidence from Brazil," Economic Journal, Royal Economic Society, vol. 116(513), pages 627-658, 07.
  12. Fortin, Bernard & Lacroix, Guy, 1997. "A Test of the Unitary and Collective Models of Household Labour Supply," Economic Journal, Royal Economic Society, vol. 107(443), pages 933-55, July.
  13. Del Boca, D. & Flinn, C.J., 1993. "Rationalizing Child Support Decisions," Working Papers 93-16, C.V. Starr Center for Applied Economics, New York University.
  14. Arellano, Manuel & Bond, Stephen, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Wiley Blackwell, vol. 58(2), pages 277-97, April.
  15. Pollak, Robert A, 1985. "A Transaction Cost Approach to Families and Households," Journal of Economic Literature, American Economic Association, vol. 23(2), pages 581-608, June.
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