A collective household labor supply model with children and non-participation: Theory and empirical application

Jaime Andrés Sarmiento Espinel () and Edwin van Gameren

Serie documentos de trabajo del Centro de Estudios Económicos from El Colegio de México, Centro de Estudios Económicos

Abstract: We extend the collective model of household behavior to consider public consumption (expenditures on children), together with non-participation in the labor market. Identification of individual preferences and the sharing rule from observing each individual’s labor supply and the total expenditure on the public good rests on the existence of a distribution factor and the existence and uniqueness of individual reservation wages at which both members are indifferent whether a member participates or not. Using a sample of Mexican nuclear families, collective rationality is not rejected. No evidence is found that empowering mothers is more beneficial for children than empowering fathers.

Keywords: collective models; labor supply; non-participation; public goods; children; intrahousehold decision-making; reservation wages; sharing rule (search for similar items in EconPapers)
JEL-codes: D11 D12 D13 J12 J13 J22 (search for similar items in EconPapers)
Date: 2016-12
New Economics Papers: this item is included in nep-lma
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Persistent link: https://EconPapers.repec.org/RePEc:emx:ceedoc:2016-11

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