Measuring the cost of children

Olivier Donni

IZA World of Labor, 2015, No 132, 132

Abstract: The cost of children is a critical parameter used in determining many economic policies. For instance, correctly setting the tax deduction for families with children requires assessing the true household cost of children. Evaluating child poverty at the individual level requires making a clear distinction between the share of family resources received by children and that received by parents. The standard ad hoc measures (equivalence scales) used in official publications to measure the cost of children are arbitrary and are not informed by any economic theory. However, economists have developed methods that are grounded in economic theory and can replace ad hoc measures.

Keywords: cost of children; consumption; Rothbarth method; Engel method; survey data (search for similar items in EconPapers)
JEL-codes: C81 D12 D13 D31 J13 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (3)

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