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Recent research describes how procedural fairness can be used to resolve issues related to ethnic-cultural matters. The central finding in this strand of literature is that when minority members experience procedurally fair treatment by societal actors regarding ethnic-cultural issues, this will lead to a range of outcomes that are beneficial for social cohesion. Although these results are promising, it remains yet to be shown that such group-specific treatment fairness does not hamper social cohesion by inciting misapprehension among members of non-recipient groups. Therefore, the present study set out to examine two central questions. First, how would minority group members respond to treatment fairness of citizens belonging to another minority group? Second, how would majority group members respond to treatment fairness of citizens belonging to minority groups? Two experimental studies (total N = 908) examined these questions. In Study 1, we compared ethnic-cultural minorities’ reactions to procedurally (un)fair treatment of their own versus a different minority group. In Study 2, we compared minority and majority group members’ responses to procedurally (un)fair treatment of minority group members. Results show that minority group member reactions to ethnic-cultural procedural fairness emanate from a shared bond with the fairness recipient(s) of the other minority group. Conversely, majority group members’ reactions are driven primarily by a perceived moral obligation to act rightfully toward members of disadvantaged groups. Taken together, our results suggest that ethnic-cultural procedural fairness enactment fosters societal unity among different groups, possibly strengthening social cohesion for well-being and prosperity among members of these groups.

The extent to which individuals commit to their partner for life has important implications. This paper develops a lifecycle collective model of the household, through which it characterizes behavior in three prominent alternative types of commitment: full, limited, and no commitment. We propose a test that distinguishes between all three types based on how contemporaneous and historical news affect household behavior. Our test permits heterogeneity in the degree of commitment across households. Using recent data from the Panel Study of Income Dynamics, we reject full and no commitment, while we find strong evidence for limited commitment.

This dissertation consists of three essays that encompass my primary and secondary research in labor economics and financial economics, respectively. The first two essays are about household economics, family structure, and labor supply, and the third essay applies time series analysis tn financial economics.The first essay was motivated by needing to understand how urban household consumption is allocated and then developing targeted measures for poverty alleviation programs in China. To my knowledge, it is the first structural estimation of the level of resource shares and quantification of intra-household inequality in urban China. In nuclear and extended households with children, I find that females on average spend 26.7% less than males, and in households without children, females on average spend 35.2% more than males. In the same households, I find that 32% of households’ resource shares are spent on children. Using the estimated individual resource shares, I find that more adult females and female children fall below the World Bank’s international poverty line than using the per capita expenditure measure levels. By ignoring intra-household inequality, we risk underestimating consumption inequality by 20.5% in urban China.The second essay was motivated by the fact that the population of unmarried heterosexual cohabiting women has nearly tripled in the US over the past two decades, and previous studies have tended to ignore these women, or treat them as single/married. I examine the labor supply responses of cohabiting women, single women, and married women from 1996 to 2016 using March-CPS (ASEC). A comparison of the three groups finds that cohabiting women have the lowest labor force participation elasticity with respect to after-tax wages. That cohabiting women would work more hours if their part-ners earned more annually and married women would not, points to another behavioral difference between the two groups. Results from ATUS-CPS 2003-2017 further imply that coh

This dissertation consists of three essays that encompass my primary and secondary research in labor economics and financial economics, respectively. The first two essays are about household economics, family structure, and labor supply, and the third essay applies time series analysis tn financial economics.The first essay was motivated by needing to understand how urban household consumption is allocated and then developing targeted measures for poverty alleviation programs in China. To my knowledge, it is the first structural estimation of the level of resource shares and quantification of intra-household inequality in urban China. In nuclear and extended households with children, I find that females on average spend 26.7% less than males, and in households without children, females on average spend 35.2% more than males. In the same households, I find that 32% of households’ resource shares are spent on children. Using the estimated individual resource shares, I find that more adult females and female children fall below the World Bank’s international poverty line than using the per capita expenditure measure levels. By ignoring intra-household inequality, we risk underestimating consumption inequality by 20.5% in urban China.The second essay was motivated by the fact that the population of unmarried heterosexual cohabiting women has nearly tripled in the US over the past two decades, and previous studies have tended to ignore these women, or treat them as single/married. I examine the labor supply responses of cohabiting women, single women, and married women from 1996 to 2016 using March-CPS (ASEC). A comparison of the three groups finds that cohabiting women have the lowest labor force participation elasticity with respect to after-tax wages. That cohabiting women would work more hours if their part-ners earned more annually and married women would not, points to another behavioral difference between the two groups. Results from ATUS-CPS 2003-2017 further imply that coh

The availability of non-labor income (including asset income and labor income from other household members) can reduce individuals’ willingness to work. In general, when non-labor income increases, the demand for leisure increases due to the income effect, and as a result the supply of labor decreases. Ito and Dejima (2016) examined the influence of asset and rental income on employment (i.e. individuals’ choice to work) of youths in Japan using anonymized microdata from the National Survey of Family Income and Expenditure from the years of 1989, 1994, 1999, and 2004. However, this anonymized microdata does not contain detailed information on household assets, which limited the ability to perform an in-depth analysis of employment and household assets. Ito and Dejima (2017) examined the impact of residential area and real estate prices on employment using individual data from the 2009 National Survey of Family Income and Expenditure. Results suggested a theoretical possibility that higher ownership of household assets increases the likelihood that household members choose not to work. This research also found geographic differences in the impact of real asset ownership on employment. Recently, two models for household decision-making have received attention. The Unitary Model assumes that consumption decisions are made by the household unit and with the aim of maximizing overall household utility, whereas the Collective Model assumes that consumption decisions are made through negotiations between household members where each member seeks to maximize their own utility. The Unitary Model stipulates that households’ consumption decisions are not impacted by household members’ individual incomes, as it assumes that the household unit seeks to maximize overall household utility. On the other hand, the Collective Model suggests that household members with higher incomes have increased negotiation power and therefore greater influence on household consumption decisions. T

We develop a theoretical model for the intra-household allocation of time and consumption. The model distinguishes between the partners' joint and private leisure time. We estimate the parameters of our model on a Danish time use survey with information on time allocation and expenditures. The empirical estimation leads to four main conclusions. First, we find that assignable expenditures vary with female and male wage rates, consistent with the collective model, and we can assign this variation to the Pareto weight being sensitive to relative wages. Second, we find that men put more weight on both their own private expenditure and composite leisure than women. Third, we find that joint leisure and individual leisure are not perfect substitutes for partners. Fourth, we observe that both joint and private leisure are independent of the wage distribution. Thus, togetherness is not a substitute for economic factors. Fifth, we find that when the female wage goes up, all else equal, her child care hours increase, while her husband's child care hours decrease.

We document that within-individual variation in food choices is substantial and has potentially important consequences for nutrition, and hence well-being. We develop an approach that allows us to study the determinants of this within-individual variation within an economic framework and allow for across-individual preference heterogeneity. We show that around one-fifth of within-individual fluctuations in diet quality is explained by standard economic variables (prices and budgets), along with advertising and weather. The residual fluctuations are important and are larger for lower income and younger people, and individuals who state they are impulsive. We propose a two-selves model of food purchase behavior to structurally interpret these empirical patterns. We use nonparametric revealed preference techniques to show that this model rationalizes our food purchase data., SCOPUS: ar.j, info:eu-repo/semantics/published

This paper adopts the new loss reserving approach proposed by Denuit and Trufin (2016), inspired from the collective model of risk theory. But instead of considering the whole set of claims as a collective, two types of claims are distinguished, those claims with relatively short development patterns and claims requiring longer developments. In each case, the total payment per cell is modelled by means of a Compound Poisson distribution with appropriate assumptions about the severities. A case study based on a motor third party liability insurance portfolio observed over 2004–2014 is used to illustrate the approach proposed in this paper. Comparisons with Chain-Ladder are performed and reveal significant differences in best estimates as well as in Value-at-Risk at high probability levels.

We derive revealed preference tests for models where individuals use consideration sets to simplify their consumption problem. Our basic test provides necessary and sufficient conditions for consistency of observed choices with the existence of consideration set restrictions. The same conditions can also be derived from a model in which the consideration set formation is endogenous and based on subjective prices. By imposing restrictions on these subjective prices, we obtain additional refined revealed preference tests. We illustrate and compare the performance of our tests by means of a dataset on household consumption choices.

We derive revealed preference tests for models where individuals use consideration sets to simplify their consumption problem. Our basic test provides necessary and sufficient conditions for consistency of observed choices with the existence of consideration set restrictions. The same conditions can also be derived from a model in which the consideration set formation is endogenous and based on subjective prices. By imposing restrictions on these subjective prices, we obtain additional refined revealed preference tests. We illustrate and compare the performance of our tests by means of a dataset on household consumption choices.

We propose novel tools for the analysis of individual welfare on the basis of aggregate household demand behavior. The method assumes a collective model of household consumption with the public and private nature of goods specified by the empirical analyst. A main distinguishing feature of our approach is that it builds on a revealed preference characterization of the collective model that is intrinsically nonparametric. We show how to identify individual money metric welfare indices from observed household demand, along with the intrahousehold sharing rule and the individuals' willingness-to-pay for public consumption (i.e. Lindahl prices). The method is easy to use in practice and yields informative empirical results, which we demonstrate through both a simulation exercise and an empirical application to labor supply data drawn from the Panel Study of Income Dynamics., We propose novel tools for the analysis of individual welfare on the basis of aggregate household demand behavior. The method assumes a collective model of household consumption with the public and private nature of goods specified by the empirical analyst. A main distinguishing feature of our approach is that it builds on a revealed preference characterization of the collective model that is intrinsically nonparametric. We show how to identify individual money metric welfare indices from observed household demand, along with the intrahousehold sharing rule and the individuals’ willingness-to-pay for public consumption (i.e. Lindahl prices). The method is easy to use in practice and yields informative empirical results, which we demonstrate through both a simulation exercise and an empirical application to labor supply data drawn from the Panel Study of Income Dynamics.

We propose novel tools for the analysis of individual welfare on the basis of aggregate household demand behavior. The method assumes a collective model of household consumption with the public and private nature of goods specified by the empirical analyst. A main distinguishing feature of our approach is that it builds on a revealed preference characterization of the collective model that is intrinsically nonparametric. We show how to identify individual money metric welfare indices from observed household demand, along with the intrahousehold sharing rule and the individuals’ willingness-to-pay for public consumption (i.e. Lindahl prices). The method is easy to use in practice and yields informative empirical results, which we demonstrate through both a simulation exercise and an empirical application to labor supply data drawn from the Panel Study of Income Dynamics., SCOPUS: ar.j, info:eu-repo/semantics/published

Collective models identifying resource shares are promising tools to analyze intra-household welfare and poverty. However, their empirical application has proven difficult in practice as authors contend with large standard errors and unstable estimates. This paper uses a prominent framework to show how a common feature of the structure of these models makes the task so difficult and proposes an empirical strategy to stabilize the estimates., SCOPUS: ar.j, info:eu-repo/semantics/published

This paper adopts the new loss reserving approach proposed by Denuit and Trufin (2016),inspired from the collective model of risk theory. But instead of considering the whole setof claims as a collective, two types of claims are distinguished, those claims with relativelyshort development patterns and claims requiring longer developments. In each case, thetotal payment per cell is modelled by means of a Compound Poisson distribution withappropriate assumptions about the severities. A case study based on a motor third partyliability insurance portfolio observed over 2004–2014 is used to illustrate the approachproposed in this paper. Comparisons with Chain-Ladder are performed and reveal significantdifferences in best estimates as well as in Value-at-Risk at high probability levels., SCOPUS: ar.j, info:eu-repo/semantics/published

We introduce childcare sharing in a collective model of household behavior to investigate which factors make spouses increase or decrease their share of parental leave. The concern about future consumption motivates parents to invest in their human capital and to limit their leave duration. Using relative income and the age difference between spouses as distribution factors, we cannot reject Pareto effciency in childcare sharing. Higher relative incomes and larger age differences shift the conditional leave allocation towards the relatively poorer and younger partner, respectively. Households with higher total income purchase more professional childcare.

We propose novel tools for the analysis of individual welfare on the basis of aggregate household demand behavior. The method assumes a collective model of household consumption with the public and private nature of goods specified by the empirical analyst. A main distinguishing feature of our method is that it builds on a revealed preference characterization of the collective model that is intrinsically nonparametric. We show how to identify individual money metric welfare indices from observed household demand, along with the intrahousehold sharing rule and the individuals' willingness-to-pay for public consumption (i.e. Lindahl prices). The method is easy to use in practice and yields informative empirical results, which we demonstrate through a simulation analysis and an empirical application to labor supply data., info:eu-repo/semantics/published

This paper exploits the experimental set-up of the cash transfer program PROGRESA in rural Mexico to estimate a collective model of the household in order to investigate how parents allocate household resources. We show that household decisions are compatible with the collective model at the beginning of the program, but reject it later on. This shows that second order effects of cash transfer programs are important and suggests we need richer structural models to thoroughly analyse these policy interventions. We end this paper by proposing such a simple and tractable model of household behaviour, where decision makers may have misaligned preferences as a result of the treatment about the importance of a public good., info:eu-repo/semantics/published

This paper proposes a new loss reserving approach, inspired from the collective model of risk theory. According to the collective paradigm, we do not relate payments to specific claims or policies but we work within a frequency-severity setting, with a number of payments in every cell of the run-off triangle, together with the corresponding paid amounts. Compared to the Tweedie reserving model, that can be seen as a compound sum with Poisson-distributed number of terms and Gamma-distributed summands, we allow here for more general severity distributions, typically mixture models combining a light-tailed component with a heavier-tailed one, including inflation effects. The severity model is fitted to individual observations and not to aggregated data displayed into run-off triangles with a single value in every cell. In that respect, the modeling approach appears to be a powerful alternative to both the crude traditional aggregated approach based on triangles and the extremely detailed individual reserving approach developing each and every claim separately. A case study based on a motor third party liability insurance portfolio observed over 2004-2014 is used to illustrate the relevance of the approach proposed in this paper., info:eu-repo/semantics/published

We show that a local average treatment effect (LATE) can sometimes be point identified and consistently estimated when treatment is mismeasured, or when treatment is estimated using a possibly misspecified structural model. Our associated estimator, which we call Mismeasurement Robust LATE (MR-LATE), is based on differencing two mismeasures of treatment. In our empirical application, treatment is women’s empowerment: whether a wife has significant control of household resources. Due to measurement difficulties and sharing of goods within a household, this treatment cannot be directly observed without error, and so must be estimated. Our outcomes are health indicators of family members. We first estimate a structural model to obtain the otherwise unobserved treatment indicator. Then, using changes in inheritance laws in India as an instrument, we apply our new MR-LATE estimator. We find that women’s empowerment substantially decreases their probability of being anemic or underweight, and children’s likelihood to suffer from cough, fever or diarrhea. We find no significant positive or negative effects on men’s health., info:eu-repo/semantics/published

This paper proposes a new loss reserving approach, combining a collective model for losses with a relatively short development pattern together with an individual model for the payments related to losses requiring longer developments. Compared to existing individual reserving methods, claims developing rapidly until settlement are grouped together and modelled collectively, which considerably reduces the computation time. Moreover, as larger claims typically develop over longer periods, the individual part of the hybrid model involves distributions with heavier tails. A case study based on a motor third party liability insurance portfolio observed over 2004-2014 is used to illustrate the value added of the hybrid approach proposed in this paper. Comparisons with Chain-Ladder and Double Chain-Ladder are performed and reveal signficant differences in best estimates as well as in Value-at-Risk at high probability levels.

This paper proposes a new loss reserving approach, inspired from the collective model of risk theory. According to the collective paradigm, we do not relate payments to specific claims or policies but we work within a frequency-severity setting, with a number of payments in every cell of the run-off triangle, together with the corresponding paid amounts. Compared to the Tweedie reserving model, that can be seen as a compound sum with Poisson-distributed number of terms and Gamma-distributed summands, we allow here for more general severity distributions, typically mixture models combining a light-tailed component with a heavier- tailed one. A case study based on a motor third party liability insurance portfolio observed over 2004-2014 is used to illustrate the approach proposed in this paper.

This paper approaches, for the first time, the estimation of a collective household demand system from a Bayesian perspective. Using prior information on equivalence scales, as well as restrictions implied by theory, tight credible intervals are found for resource shares, a measure of the distribution of economic well-being in a household. A modern MCMC sampling method provides a complete picture of the high-dimensional parameter vector's posterior distribution and allows for reliable inference. The share of household earnings generated by a household member is estimated to have a positive effect on her share of household resources in a sample of couples from the US Consumer Expenditure survey. An increase in the earnings share of one percentage point is estimated to result in a shift of between 0:05% and 0:14% of household resources in the same direction, meaning that spouses partially insure one another against such shifts. The estimates imply an expected shift of 0:71% of household resources from the average man to the average woman in the same sample between 2008 and 2012, when men lost jobs at a greater rate than women., info:eu-repo/semantics/published

This paper estimates a collective model of the household and investigates how parents reach decisions to allocate household resources. Using data from PROGRESA, we test the restrictions of collective rationality on a large variety of specifications and show that, contrary to previous results, this modeling approach cannot rationalize the household decision process. We provide some evidence that the observed inefficiency is driven by the group receiving the cash transfers. These results are consistent with the idea that a possible indirect effect of CCT programs may be to enhance disagreements between the spouses which trigger an inefficient allocation of their resources., info:eu-repo/semantics/published

Dunbar et al. (2013) develop a collective model of the household that allows to identify resource shares, that is, how total household resources are divided up among household members. We show why, especially when the data exhibit relatively flat Engel curves, the model is weakly identified and induces high variability and an implausible pattern in least squares estimates. We propose an estimation strategy nested in their framework that greatly reduces this practical impediment to recovery of individual resource shares. To achieve this, we follow an empirical Bayes method that incorporates additional (or out-of-sample) information on singles and relies on mild assumptions on preferences. We show the practical usefulness of this strategy through a series of Monte Carlo simulations and by applying it to Mexican data. The results show that our approach is robust, gives a plausible picture of the household decision process, and is particularly beneficial for the practitioner who wishes to apply the DLP framework. Our welfare analysis of the PROGRESA program in Mexico is the first to include separate poverty rates for men and women in a CCT program., info:eu-repo/semantics/published

We introduce childcare sharing in a collective model of household behavior to investigate which factors make spouses increase or decrease their share of parental leave. The concern about future consumption motivates parents to invest in their human capital and to limit their leave duration. Using relative income and the age difference between spouses as distribution factors, we cannot reject Pareto efficiency in childcare sharing. Higher relative incomes and larger age differences shift the conditional leave allocation towards the relatively poorer and younger partner, respectively. Households with higher total income purchase more professional childcare.

info:eu-repo/semantics/published

The purpose of this paper is to establish the complexity of alternative versions of the weak axiom of revealed preference (. warp) for collective consumption models. In contrast to the unitary consumption model, these collective models explicitly take the multi-member nature of the household into account. We consider the three collective settings that are most often considered in the literature. We start with the private setting in which all goods are privately consumed by the household members. Next, we consider the public setting in which all goods are publicly consumed inside the household. Finally, we also consider the general setting where no information on the (private or public) nature of goods consumed in the household is available. We prove that the collective version of warp is np-hard to test for both the private and public settings. Surprisingly, we also find for the general setting that the collective version of warp is easy to test for two-member households., SCOPUS: ar.j, info:eu-repo/semantics/published

The purpose of this paper is to establish the complexity of alternative versions of the weak axiom of revealed preference (. warp) for collective consumption models. In contrast to the unitary consumption model, these collective models explicitly take the multi-member nature of the household into account. We consider the three collective settings that are most often considered in the literature. We start with the private setting in which all goods are privately consumed by the household members. Next, we consider the public setting in which all goods are publicly consumed inside the household. Finally, we also consider the general setting where no information on the (private or public) nature of goods consumed in the household is available. We prove that the collective version of warp is np-hard to test for both the private and public settings. Surprisingly, we also find for the general setting that the collective version of warp is easy to test for two-member households., SCOPUS: ar.j, info:eu-repo/semantics/published

info:eu-repo/semantics/published

We propose a method to set identify bounds on the sharing rule for a general collective household consumption model. Unlike the effects of distribution factors, the level of the sharing rule cannot be uniquely identified without strong assumptions on preferences across households. Our new results show that, though not point identified without these assumptions, strong bounds on the sharing rule can be obtained. We get these bounds by applying revealed preference restrictions implied by the collective model to the household's continuous aggregate demand functions. We obtain informative bounds even if nothing is known about whether each good is public, private, or assignable within the household, though having such information tightens the bounds. We apply our method to US PSID data, obtaining narrow bounds that yield useful conclusions regarding the effects of income and wages on intrahousehold resource sharing, and on the prevalence of individual (as opposed to household level) poverty., SCOPUS: ar.j, FLWIN, info:eu-repo/semantics/published

In this study, I examine the allocation mechanism within families by using the collective model. The empirical results suggest that a wife's income proportion affects her budget proportion. This connection exists for food and shows that a wife's income proportion is positively correlated with her preferred share of the food budget but is negatively correlated with a husband's preferred share of the food budget. I also explored the changes in a wife's income proportion and budget proportion between 1989 and 2004 and found that the correlation between the two became larger, suggesting that a wife's distribution power strengthened during this period.

We apply the collective consumption model of Browning et al. (2010) to analyse economic well-being and poverty among the elderly. The model focuses on individual preferences, a consumption technology that captures the economies of scale of living in a couple, and a sharing rule that governs the intra-household allocation of resources. The model is applied to a time series of Dutch consumption expenditure surveys. Our empirical results indicate substantial economies of scale and a wife's share that is increasing in total expenditures. We further calculated two sets of poverty rates: one based on the collective consumption model and one based on the traditional approach with a standard equivalence scale. Poverty among widowers is underestimated by the traditional approach. The same is true for women (men) in elderly couples for the first (later) time periods in our analysis. Finally, we analysed the impact of becoming a widow(er). Based on cross-sectional evidence, we find that the drop in material well-being following the husband's death is rather substantial for women. For men, the picture is reversed. © 2012 Elsevier B.V.., SCOPUS: ar.j, info:eu-repo/semantics/published

This dissertation consists of three essays studying the effects of collective household decisions on early childhood development from both empirical and theoretical perspectives. The first chapter outlines the dissertation, by presenting the motivations, methods, conclusions, and policy implications for the entire dissertation. Chapter two examines early childhood development using a collective model with children's cognitive production. We jointly estimate the home input demand with children's cognitive production functions based on a simultaneous equations model. Biases are considered that are caused by the non-random selection of time inputs and possible correlations across inputs and outcomes functions. A direct measure of time inputs relying on children's time diaries from the Child Development Supplement of the Panel Study of Income Dynamics (PSID-CDS) has been constructed. We thereby relax the assumption that there is no difference between parental time spent on children and leisure. Our results show that parental time inputs, especially the active time interacting with children's daily activities, have substantial effects on both children's math and reading test scores. The time inputs vary across parents' age, race, and eduction levels. In chapter three, we conduct a standard Blinder-Oaxaca decomposition to evaluate the role of home inputs in the black-white test score gaps based on the empirical model presented in chapter two. Aside from the finding that children's ability accounts for a large proportion of the differences, we find that home inputs can also explain a significant portion of the gap. When the maternal time is equalized at the average levels of white children, the racial differences in children's reading and math test scores can be closed by approximately 30%-50%. The last chapter extends a collective model with household production to the general equilibrium framework. We concentrate on the impacts of a global bargaining power shift within t

We apply the collective consumption model of Browning et al. (2010) to analyse economic well-being and poverty among the elderly. The model focuses on individual preferences, a consumption technology that captures the economies of scale of living in a couple, and a sharing rule that governs the intra-household allocation of resources. The model is applied to a time series of Dutch consumption expenditure surveys. Our empirical results indicate substantial economies of scale and a wife's share that is increasing in total expenditures. We further calculated two sets of poverty rates: one based on the collective consumption model and one based on the traditional approach with a standard equivalence scale. Poverty among widowers is underestimated by the traditional approach. The same is true for women (men) in elderly couples for the first (later) time periods in our analysis. Finally, we analysed the impact of becoming a widow(er). Based on cross-sectional evidence, we find that the drop in material well-being following the husband's death is rather substantial for women. For men, the picture is reversed. © 2012 Elsevier B.V.., SCOPUS: ar.j, info:eu-repo/semantics/published

We propose a method to identify bounds (i.e. set identification) on the sharing rule for a general collective household consumption model. Unlike the effects of distribution factors, it is well known that the level of the sharing rule cannot be uniquely identified without strong assumptions on preferences across households of different compositions. Our new results show that, though not point identified without these assumptions, bounds on the sharing rule can still be obtained. We get these bounds by applying revealed preference restrictions implied by the collective model to the household's continuous aggregate demand functions. We obtain informative bounds even if nothing is known about whether each good is public, private, or assignable within the household, though having such information tightens the bounds. An empirical application demonstrates the practical usefulness of our method.

We present a revealed preference methodology for empirically analysing collective consumption behaviour. First, we introduce an integer programming (IP) methodology for testing data consistency with collective consumption models that account for publicly as well as privately consumed goods. This IP methodology can include information on "assignable quantities" for private goods. Next, we show that the IP methodology allows for recovering the personalized (Lindahl) prices for the public goods and the personalized quantities for the private goods. In turn, this implies recovery of the sharing rule (i.e. personalized income share levels). An empirical application demonstrates the practical usefulness of the methodology. © The Author 2011. Published by Oxford University Press., SCOPUS: ar.j, info:eu-repo/semantics/published

We present a revealed preference methodology for empirically analysing collective consumption behaviour. First, we introduce an integer programming (IP) methodology for testing data consistency with collective consumption models that account for publicly as well as privately consumed goods. This IP methodology can include information on "assignable quantities" for private goods. Next, we show that the IP methodology allows for recovering the personalized (Lindahl) prices for the public goods and the personalized quantities for the private goods. In turn, this implies recovery of the sharing rule (i.e. personalized income share levels). An empirical application demonstrates the practical usefulness of the methodology. © The Author 2011. Published by Oxford University Press., SCOPUS: ar.j, info:eu-repo/semantics/published

We review a nonparametric "revealed preference" methodology for analyzing collective consumption behavior in practical applications. The methodology allows for accounting for externalities, public consumption, and the use of assignable quantity information in the consumption analysis. This provides a framework for empirically assessing welfare-related questions that are specific to the collective model of household consumption. As a first step, we discuss the testable necessary and sufficient conditions for data consistency with special cases of the collective model (e.g. the case with all goods publicly consumed, and the case with all goods privately consumed without externalities); these conditions can be checked by means of mixed integer (linear) programming (MIP) solution algorithms. Next, we focus on a testable necessary condition for the most general model in our setting (i.e. the case in which any good can be publicly consumed as well as privately consumed, possibly with externalities); again, this condition can be checked by means of MIP solution algorithms. Even though this general model imposes minimal structure a priori, we show that the MIP characterization allows for deriving bounds on the feasible income shares. Finally, we illustrate our methods by some empirical applications to data drawn from the Russian Longitudinal Monitoring Survey. © 2012 L. Cherchye, B. De Rock and F. Vermeulen., SCOPUS: re.j, info:eu-repo/semantics/published

We provide a nonparametric 'revealed preference' characterization of rational household behavior in terms of the collective consumption model, while accounting for general individual preferences that can be non-convex. Our main result is the Collective Afriat Theorem, which parallels the well-known Afriat Theorem for the unitary model. First, it provides a characterization of collectively rational consumption behavior in terms of collective Afriat inequalities. Next, it implies the Collective Axiom of Revealed Preference (CARP) as a testable necessary and sufficient condition for data consistency with collective rationality. Finally, the theorem has some interesting testability implications. With only a finite set of observations, the nature of consumption externalities (positive or negative) in the intra-household allocation process is non-testable. The same non-testability conclusion holds for privateness (with or without externalities) or publicness of consumption. By contrast, concavity of individual utility functions (representing convex preferences) turns out to be testable. In addition, monotonicity is testable for the model that assumes all household consumption is public. © 2009 Elsevier Inc., SCOPUS: ar.j, info:eu-repo/semantics/published

We provide a nonparametric 'revealed preference' characterization of rational household behavior in terms of the collective consumption model, while accounting for general individual preferences that can be non-convex. Our main result is the Collective Afriat Theorem, which parallels the well-known Afriat Theorem for the unitary model. First, it provides a characterization of collectively rational consumption behavior in terms of collective Afriat inequalities. Next, it implies the Collective Axiom of Revealed Preference (CARP) as a testable necessary and sufficient condition for data consistency with collective rationality. Finally, the theorem has some interesting testability implications. With only a finite set of observations, the nature of consumption externalities (positive or negative) in the intra-household allocation process is non-testable. The same non-testability conclusion holds for privateness (with or without externalities) or publicness of consumption. By contrast, concavity of individual utility functions (representing convex preferences) turns out to be testable. In addition, monotonicity is testable for the model that assumes all household consumption is public. © 2009 Elsevier Inc., SCOPUS: ar.j, info:eu-repo/semantics/published

We review a nonparametric "revealed preference" methodology for analyzing collective consumption behavior in practical applications. The methodology allows for accounting for externalities, public consumption, and the use of assignable quantity information in the consumption analysis. This provides a framework for empirically assessing welfare-related questions that are specific to the collective model of household consumption. As a first step, we discuss the testable necessary and sufficient conditions for data consistency with special cases of the collective model (e.g. the case with all goods publicly consumed, and the case with all goods privately consumed without externalities); these conditions can be checked by means of mixed integer (linear) programming (MIP) solution algorithms. Next, we focus on a testable necessary condition for the most general model in our setting (i.e. the case in which any good can be publicly consumed as well as privately consumed, possibly with externalities); again, this condition can be checked by means of MIP solution algorithms. Even though this general model imposes minimal structure a priori, we show that the MIP characterization allows for deriving bounds on the feasible income shares. Finally, we illustrate our methods by some empirical applications to data drawn from the Russian Longitudinal Monitoring Survey. © 2012 L. Cherchye, B. De Rock and F. Vermeulen., SCOPUS: re.j, info:eu-repo/semantics/published

We propose a collective labor supply model with household production that generalizes an original model of Blundell, Chiappori and Meghir (2005). In our model, adults' individual preferences do not only depend on own leisure and individual private consumption of market goods. They also depend on the con- sumption of domestic goods, which are produced by combining goods bought at the market with individuals' time. We apply our model to new and unique data on Dutch couples with children. The data contains detailed information about the spouses' time use and the intrahousehold allocation of all expendi- tures. Our application uses a novel estimation strategy that builds upon the familiar two-stage allocation representation of the collective model. We obtain interesting (and plausible) empirical results. Spouses' preferences depend on the consumption of domestically produced goods (including children's welfare). Next, Pareto weights depend on variables like the individual wages and the share in the household’s nonlabor income. Finally, and perhaps surprisingly, we do not find evidence that mothers care more for their children than fathers.

We present a nonparametric 'revealed preference' methodology for empiri- cally analyzing collective consumption behavior. First, we introduce an integer programming (IP) methodology for testing data consistency with collective con- sumption models that account for publicly as well as privately consumed goods. This IP methodology can include information on 'assignable quantities' for pri- vate goods. Next, we show that the IP methodology allows for recovering the personalized (Lindahl) prices for the public goods and the personalized quan- tities for the private goods. In turn, this implies recovery of the sharing rule (i.e. personalized income share levels). Numerical examples and an empirical application demonstrate the practical usefulness of the methodology.

We provide a nonparametric 'revealed preference' characterization of rational household behavior in terms of the collective consumption model, while accounting for general (possibly non-convex) individual preferences. We establish a Collective Axiom of Revealed Preference (CARP), which provides a necessary and su¢ cient condition for data consistency with collective rationality. Our main result takes the form of a 'collective' version of the Afriat Theorem for rational behavior in terms of the unitary model. This theorem has some interesting implications. With only a finite set of observations, the nature of consumption externalities (positive or negative) in the intra-household allocation process is non-testable. The same non-testability conclusion holds for privateness (with or without externalities) or publicness of consumption. By contrast, concavity of individual utility functions (representing convex preferences) turns out to be testable. In addition, monotonicity is testable for the model that assumes all household consumption is public.

We apply the collective consumption model of Browning, Chiappori and Lew- bel (2006) to analyse economic well-being and poverty among the elderly. The model focuses on individual preferences, a consumption technology that captures the economies of scale of living in a couple, and a sharing rule that governs the intra-household allocation of resources. The model is applied to a time series of Dutch consumption expenditure surveys. Our empirical results indicate substan- tial economies of scale and a wife's share that is increasing in total expenditures. We further calculated poverty rates by means of the collective consumption model. Collective poverty rates of widows and widowers turn out to be slightly lower than traditional ones based on a standard equivalence scale. Poverty among women (men) in elderly couples, however, seems to be heavily underestimated (overesti- mated) by the traditional approach. Finally, we analysed the impact of becoming a widow(er). Based on cross-sectional evidence, we find that the drop (increase) in material well-being following the husband's death is substantial for women in high (low) expenditure couples. For men, the picture is reversed.

We present a nonparametric 'revealed preference' methodology for empirically analyzing collective consumption behavior. First, we introduce an integer programming (IP) methodology for testing data consistency with alternative collective consumption models: the 'general' case in which any good can be publicly consumed as well as privately consumed, possibly with externalities; and 'special' cases that impose specific prior structure (e.g. the case with all goods publicly consumed, and the case with all goods privately consumed without externalities). In addition, we show that this IP methodology can include information on 'assignable quantities' for particular goods. Next, we demonstrate that the IP methodology allows for recovering the structural collective decision model (including the sharing rule) from the observed collective consumption behavior. In turn, this makes it possible to address welfare-related questions that are specific to the collective consumption model., info:eu-repo/semantics/nonPublished

We provide a nonparametric 'revealed preference’ characterization of rational household behavior in terms of the collective consumption model, while accounting for general (possibly non-convex) individual preferences. We establish a Collective Axiom of Revealed Preference (CARP), which provides a necessary and sufficient condition for data consistency with collective rationality. Our main result takes the form of a ‘collective’ version of the Afriat Theorem for rational behavior in terms of the unitary model. This theorem has some interesting implications. With only a finite set of observations, the nature of consumption externalities (positive or negative) in the intra-household allocation process is non-testable. The same non-testability conclusion holds for privateness (with or without externalities) or publicness of consumption. By contrast, concavity of individual utility functions (representing convex preferences) turns out to be testable. In addition, monotonicity is testable for the model that assumes all household consumption is public., info:eu-repo/semantics/published

We compare the empirical performance of unitary and collective labor supply models, using representative data from the Dutch DNB Household Survey.We conduct a nonparametric analysis that avoids the distortive impact of an erroneously speci.ed functional form for the prefer-ences and/or the intrahousehold bargaining process.Our analysis focuses on the goodness-of-.t of the two behavioral models.To guarantee a fair comparison, we complement this goodness-of-.t analysis with a power analysis.Our results strongly favor the collective approach to modeling the behavior of multi-person households

The purpose of this paper is to estimate the intra-family distribution of income and the individual demand for leisure and household production from Swedish cross-sectional household data. As a basis for the analysis, we use a collective model where each individual is characterized by his or her own utility function and divides total time between leisure, household production and market work. For the purpose of comparison, we also estimate a version that is consistent with a more traditional model of labor supply, the unitary model.