Household Consumption When the Marriage Is Stable
American Economic Review
vol. 107,
no. 6, June 2017
(pp. 1507-34)
Abstract
We develop a novel framework to analyze the structural implications of the marriage market for household consumption. We define a revealed preference characterization of efficient household consumption when the marriage is stable. We characterize stable marriage with intrahousehold (consumption) transfers but without assuming transferable utility. Our revealed preference characterization generates testable conditions even with a single observation per household and heterogeneous individual preferences across households. The characterization also allows for identifying the intrahousehold decision structure (including the sharing rule) under the same minimalistic assumptions. An application to Dutch household data illustrates the usefulness of our theoretical results.Citation
Cherchye, Laurens, Thomas Demuynck, Bram De Rock, and Frederic Vermeulen. 2017. "Household Consumption When the Marriage Is Stable." American Economic Review, 107 (6): 1507-34. DOI: 10.1257/aer.20151413Additional Materials
JEL Classification
- D60 Welfare Economics: General
- D63 Equity, Justice, Inequality, and Other Normative Criteria and Measurement
- H21 Taxation and Subsidies: Efficiency; Optimal Taxation
- H23 Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies
- I38 Welfare, Well-Being, and Poverty: Government Programs; Provision and Effects of Welfare Programs