Estimating Consumption Economies of Scale, Adult Equivalence Scales, and Household Bargaining Power

Martin Browning, Pierre Chiappori () and Arthur Lewbel ()

No 289, Economics Series Working Papers from University of Oxford, Department of Economics

Abstract: How much income would a woman living alone require to attain the same standard of living that she would have if she were married? What percentage of a married couple`s expenditures are controlled by the husband? How much money does a couple save on consumption goods by living together versus living apart? We propose and estimate a collective model of household behavior that permits identification and estimation of concepts such as these. We model households in terms of the utility functions of its members, a bargaining or social welfare function, and a consumption technology function. We demonstrate generic nonparametric identification of the model, and hence of a version of adult equivalence scales that we call "indifference scales", as well as consumption economies of scale, the household`s resource sharing rule or members` bargaining power, and other related concepts.

Keywords: Consumer Demand; Collective Model; Adult Eqivalence Scales; Indifference Scales; Household Bargaining; Economies of Scale; Demand Systems; Bargaining Power; Barten Scales; Sharing Rule; Nonparametric Identification. (search for similar items in EconPapers)
JEL-codes: D11 D12 C30 I31 D63 J12 (search for similar items in EconPapers)
Date: 2006
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Related works:
Working Paper: Estimating Consumption Economies of Scale, Adult Equivalence Scales, and Household Bargaining Power (2003)
Working Paper: Estimating Consumption Economies of Scale, Adult Equivalence Scales, and Household Bargaining Power (2006)
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