Essays on Household Economics

Essays on Household Economics

Author: Abdelrahmen El Lahga

Publisher:

Published: 2008

Total Pages: 389

ISBN-13:

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This thesis presents four self-contained essays on household economics. The first essay tests whether children of certain age groups should be treated as decision makers within the household, applying an existing testing methodology developed for determining the number of adult decision makers in the context of a collective household model. The second essay compares two types of matrix rank based tests for the number of household decision makers - using conditional and using unconditional demand functions. The analysis shows robust evidence in favour of two decision makers, with the interpretation that husband and wife are separate decision makers.The third essay uses the very general technique of indirect inference to estimate a collective household labour supply model in a new and attractive way, and shows that this technique can be applied very fruitfully here. The last essay analyzes reduced form models of time allocation using panel data models applied to the German Socio-Economic Panel. It exploits variation in marital status of couples over time. Controlling for fixed effects, it finds evidence that marriage increases women specialization in domestic work.


Empirical Estimation Results of a Collective Household Time Allocation Model

Empirical Estimation Results of a Collective Household Time Allocation Model

Author: Chris van Klaveren

Publisher:

Published: 2014

Total Pages: 0

ISBN-13:

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In this paper an empirical model is developed where the collective household model is used as a basic framework to describe the time allocation problem. The collective model views household behavior as the outcome of maximizing a household utility function which is a weighted sum of the utility functions of the male and the female. The empirical research that has been done is mainly focused on testing and refuting the unitary model. Moreover, in the bulk of time allocation literature the main accent still lies on the development of theory. The novelty of this paper is that we empirically estimate the two individual utility functions and the household power weight distribution, which is parameterized per household. The model is estimated on a sub-sample of the British Household Panel Survey, consisting of two-earner households. The empirical results suggest that: (1) Given that the weight distribution is wage dependent, preferences of males and females differ, which rejects the unitary model; (2) the power differences are mainly explained by differences in the ratio of the partners' hourly wages; (3) although there are significant individual variations on average the power distribution in two-earner families is about even; (4) the male tends to be marginally more productive in performing household tasks than the female; (5) the preference for total household production is influenced by family size for the female but not for the male; and (6) both males and females have a backward-bending labor supply curve.


Essays on Intra-household Distribution of Resource and Time

Essays on Intra-household Distribution of Resource and Time

Author: Gee Young Oh

Publisher:

Published: 2021

Total Pages:

ISBN-13:

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This dissertation consists of three chapters. The first chapter empirically explores the relationships between intra-household time allocation choices and gender role bias, and the second chapter provides a structural model that rationalizes the empirical findings to study its policy implications. The third chapter explores the relationship between intra-household consumption distributions and subjective wellbeing of each gender. In the first two chapters, I study how gender role bias affects the time allocations of heterosexual working couples in labor, home production, and leisure, and the ramifications for distributional effects of policies that change effective wages. Using detailed time use data from Mexico and the U.K., I document that among working couples in both countries, as a female's relative wage increases, her relative labor hours decrease, and her relative home production hours increase. The pattern is seemingly puzzling but it can be rationalized if couples face disutility for breaking a social norm as females' share of household earnings increases. I then build a structural household model that incorporates gender role bias. Fitting the model to the U.K. data on working couples, I find that on average, disutility arising from gender role bias starts increasing when a female's earning share exceeds 0.45, that is, when she is nearly the breadwinner. Furthermore, I construct a measure of household-level bias using responses to survey questions on bias, and find that in more biased households, the disutility starts increasing when the female's earning share is lower. Using the model, I predict the effects of a fiscal policy that disproportionately increases females' effective wages. In particular, I find that when a given policy increases females' wages by 10 percent, the policy's effect on female labor supply is overestimated by 5 percentage points if gender role bias is not taken into account. In the third chapter, I study how intra-household inequality affects individuals' wellbeing where each member has the bargaining power to secure more household resources to be allocated for his/her interest. Unlike the existing literature that focuses on `absolute' resource levels, I explore another channel through which unequal intra-household resource distribution can affect an individual's wellbeing: by affecting `relative' resource as compared to the other household member. From detailed Mexican household-level survey data, I estimate an individual's resource level through a structural household model and explore its relationship with happiness, using self-reported subjective wellbeing as a proxy for happiness. I find that there is a negative correlation between relative resource levels and happiness for adult females. The negative correlation is consistent with studies that find domestic violence rates are higher for empowered females, or working females, who also consume more than those less empowered. However, the relation is insignificant for adult males.


Essays on Household Decision

Essays on Household Decision

Author:

Publisher:

Published: 2014

Total Pages: 104

ISBN-13:

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This thesis considers the fact that the majority of households consists of two adults whose characteristics and preferences matter for the households' decisions. The rst chapter studies how an increase in the generosity of maternity leave payments a ects parental labor supply, early child development, and the relative well-being of the parents considering that parents may have di erent preferences over outcomes and that the policy change may a ect the parental bargaining positions. I develop and estimate a static cooperative Nash bargaining model of parental decision-making in the rst period of the child's life and use the model to investigate how the decision-making changes with an increase in the leave payments. The results indicate that mothers will spend more time at home rather than in the labor market when the leave payments increase, but that the average early child development is not much a ected. Furthermore, the policy shifts the bargaining positions within the household in favor of the father and, although both parents are better o from the policy change, the mother would be better o relative to the father without the increase in maternity leave payments. In the second chapter we look closer at how the insurance value of marriage, represented by the correlation of shocks to individual incomes, varies over di erent groups in the popu- lation. We nd that this value may be lower for more recent cohorts, and decrease with age and with higher education. The third chapter builds on the second. We investigate the importance of intra-household risk-sharing through labor supply by testing the following prediction: A higher correlation of income shocks within the household implies a lower ability to insure income through spousal labor supply and should, all else equal, lead to higher asset accumulation of the house- hold. Our results indicate that this prediction holds empirically, suggesting that households perceive spousal labor supply as an important income insurance.


A Collective Household Model of Time Allocation - a Comparison of Native Dutch and Immigrant Households in the Netherlands

A Collective Household Model of Time Allocation - a Comparison of Native Dutch and Immigrant Households in the Netherlands

Author: Chris van Klaveren

Publisher:

Published: 2008

Total Pages: 36

ISBN-13:

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Although the number of immigrant households in the Netherlands is substantial, the labor supply choices of this group are usually neglected in empirical studies because these households are usually under-sampled. We use a stratified sample of Turkish, Surinamese/Antillean and Dutch households that enables us to discuss how two-earner households allocate their time to different activities. In order to do so, we empirically estimate a collective household labor supply model. The main findings are that: (1) Leisure and household income are the most important variables in the utility function of the male. (2) Leisure, total household production and total household production interacted with family size are important variables in the utility function of the female. The latter two are especially important for Turkish and Surinamese/Antillean females. (3) The utility of Turkish and Dutch males weighs slightly more than the utility of the partner in the household utility function. For Surinamese/Antillean families we find the opposite. (4) Utility weighting depends on the presence of children and on the hourly wage rates of both partners. (5) The labor supply curve is forward bending for both male and female in terms of their own wage. The labor supply curve is backward bending for both male and female in terms of the partners wage. We find this for all household types. (6) The presence of (more) children reduces the hours of labor supplied by women and increases the number of hours supplied by men.


Unitary Versus Collective Models of the Household

Unitary Versus Collective Models of the Household

Author: Pierre-Andre Chiappori

Publisher: World Bank Publications

Published: 1993

Total Pages: 48

ISBN-13:

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A case for shifting from the unitary to the collective model of the household -- in which the household may be viewed as a factory in which individuals are motivated at times by altruism, at times by self- interest, and often by both.


Economics of the Family

Economics of the Family

Author: Martin Browning

Publisher: Cambridge University Press

Published: 2014-06-05

Total Pages: 511

ISBN-13: 1107728924

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The family is a complex decision unit in which partners with potentially different objectives make consumption, work and fertility decisions. Couples marry and divorce partly based on their ability to coordinate these activities, which in turn depends on how well they are matched. This book provides a comprehensive, modern and self-contained account of the research in the growing area of family economics. The first half of the book develops several alternative models of family decision making. Particular attention is paid to the collective model and its testable implications. The second half discusses household formation and dissolution and who marries whom. Matching models with and without frictions are analyzed and the important role of within-family transfers is explained. The implications for marriage, divorce and fertility are discussed. The book is intended for graduate students in economics and for researchers in other fields interested in the economic approach to the family.