Efficient Intra-Household Allocations and Distribution Factors: Implications and Identification

François Bourguignon (1, 2) , Martin Browning (3) , Pierre-André Chiappori (4)

1 PJSE - Paris-Jourdan Sciences Economiques
2 PSE - Paris School of Economics
3 Columbia University [New York]
4 University of Oxford

This paper provides an exhaustive characterization of testability and identifiability issues in the collective framework in the absence of price variation; it thus provides a theoretical underpinning for a number of empirical works that have been developed recently. We first provide a simple and general test of the Pareto-efficiency hypothesis, which is consistent with all possible assumptions on the private or public nature of goods, all possible consumption externalities between household members, and all types of interdependent individual preferences and domestic production technology. The test is proved to be necessary and sufficient. We then provide conditions for the identification of the sharing rule and the Engel curves of individual household members for a variety of different observational schemes.

Domaines: Economies et finances

François Bourguignon, Martin Browning, Pierre-André Chiappori. Efficient Intra-Household Allocations and Distribution Factors: Implications and Identification. Review of Economic Studies, 2009, 76 (2), pp.503-528. ⟨10.1111/j.1467-937X.2008.00525.x⟩. ⟨halshs-00754386⟩