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Allocation within the household: direct survey evidence

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  • Martin Browning
  • Jens Bonke

Abstract

We report on a new diary based expenditure survey that for the first time collects direct information on the allocation of all expenditures to different members of the household. The most important finding from the survey is that the mean share that wives have of all expenditures that are assignable to husband or wife is well determined and very close to one half. Despite this equality at the mean, there is considerable dispersion across the population and in half of households one partner receives twice as much (or more) as the other. Moreover, these expenditures comprise a sizable part of the household budget. For example, the mean joint expenditure by husbands and wives on their own private, assignable goods accounts for 11% of disposable income. The main observable determinants of the variation of sharing expenditures across couples are a mixture of variables found in previous studies and variables that have not been considered before. As regards the former, we find that wives in higher educated and/or higher income households have a higher expenditure share. The other familiar effect is that the wife`s share of assignable expenditures is increasing in her share of gross income. Turning to variables that have not previously been considered in the literature, we find that some of these are highly significant and also have a strong impact on sharing. If the husband had a mother who was in full-time employment when he was aged 14 then he receives over two percentage points more of assignable expenditure than if his mother was not employed full-time. The strongest effect is also the most puzzling. If the wife has a child who is not the natural child of her partner then she receives six percentage points of assignable expenditure less than an otherwise comparable woman. On the other hand, men do better if they have had a previous child.

Suggested Citation

  • Martin Browning & Jens Bonke, 2006. "Allocation within the household: direct survey evidence," Economics Series Working Papers 286, University of Oxford, Department of Economics.
  • Handle: RePEc:oxf:wpaper:286
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    File URL: http://www.economics.ox.ac.uk/materials/working_papers/paper286.pdf
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    References listed on IDEAS

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    1. 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.
    2. Martin Browning & Pierre-André Chiappori & Valérie Lechene, 2006. "Collective and Unitary Models: A Clarification," Review of Economics of the Household, Springer, vol. 4(1), pages 5-14, March.
    3. Richard W. Blundell & James L. Powell, 2004. "Endogeneity in Semiparametric Binary Response Models," Review of Economic Studies, Oxford University Press, vol. 71(3), pages 655-679.
    4. 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.
    5. Donald W. K. Andrews, 2002. "Higher-Order Improvements of a Computationally Attractive "k"-Step Bootstrap for Extremum Estimators," Econometrica, Econometric Society, vol. 70(1), pages 119-162, January.
    6. Davidson, Russell & MacKinnon, James G, 1999. "Bootstrap Testing in Nonlinear Models," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 40(2), pages 487-508, May.
    7. François Bourguignon & Martin Browning & Pierre-André Chiappori, 2009. "Efficient Intra-Household Allocations and Distribution Factors: Implications and Identification," Review of Economic Studies, Oxford University Press, vol. 76(2), pages 503-528.
    8. Pahl, Jan, 1995. "His money, her money: Recent research on financial organisation in marriage," Journal of Economic Psychology, Elsevier, vol. 16(3), pages 361-376, September.
    9. Shelly Lundberg & Robert Pollak, 2003. "Efficiency in Marriage," Review of Economics of the Household, Springer, vol. 1(3), pages 153-167, September.
    10. Raquel Fernández & Alessandra Fogli & Claudia Olivetti, 2004. "Mothers and Sons: Preference Formation and Female Labor Force Dynamics," The Quarterly Journal of Economics, Oxford University Press, vol. 119(4), pages 1249-1299.
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    Cited by:

    1. Figari, Francesco & Immervoll, Herwig & Levy, Horacio & Sutherland, Holly, 2007. "Inequalities Within Couples: Market Incomes and the Role of Taxes and Benefits in Europe," IZA Discussion Papers 3201, Institute for the Study of Labor (IZA).
    2. Martina Mysíková, 2010. "Income Inequalities within Couples in the Czech Republic and European Countries," LIS Working papers 552, LIS Cross-National Data Center in Luxembourg.
    3. Cherchye, L.J.H. & de Rock, B. & Vermeulen, F.M.P., 2009. "The Revealed Preference Approach to Collective Consumption Behavior : Nonparametric Testing and Sharing Rule Recovery (Revised version of CentER DP 2007-73)," Discussion Paper 2009-68, Tilburg University, Center for Economic Research.
    4. Couprie, Hélène & Peluso, Eugenio & Trannoy, Alain, 2010. "Is power more evenly balanced in poor households?," Journal of Public Economics, Elsevier, vol. 94(7-8), pages 493-507, August.
    5. Antonella Caiumi & Federico Perali, 2010. "Who Bears the Full Costs of Children?," Working Papers 01/2010, University of Verona, Department of Economics.
    6. Sabrina Bruyneel & Laurens Cherchye & Bram De Rock, 2012. "Collective consumption models with restricted bargaining weights: an empirical assessment based on experimental data," Review of Economics of the Household, Springer, vol. 10(3), pages 395-421, September.
    7. Hélène Couprie & Gaëlle Ferrant, 2015. "Welfare Comparisons, Economies of Scale and Equivalence Scale in Time Use," Annals of Economics and Statistics, GENES, issue 117-118, pages 185-210.
    8. Laurens Cherchye & Bram De Rock & Frederic Vermeulen, 2011. "The Revealed Preference Approach to Collective Consumption Behaviour: Testing and Sharing Rule Recovery," Review of Economic Studies, Oxford University Press, vol. 78(1), pages 176-198.

    More about this item

    Keywords

    Intrahousehold Allocation; Sharing;

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis

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