Individual welfare analysis for collective households
Publikation: Working paper › Forskning
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Individual welfare analysis for collective households. / Cherchye, Laurens ; Cosaert, Sam; de Rock, Bram; Kerstens, Pieter Jan T; Vermeulen, Frederic .
Department of Economics, KU Leuven, 2017.Publikation: Working paper › Forskning
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TY - UNPB
T1 - Individual welfare analysis for collective households
AU - Cherchye, Laurens
AU - Cosaert, Sam
AU - de Rock, Bram
AU - Kerstens, Pieter Jan T
AU - Vermeulen, Frederic
PY - 2017
Y1 - 2017
N2 - We propose novel tools for the analysis of individual welfare on the basis ofaggregate 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.
AB - We propose novel tools for the analysis of individual welfare on the basis ofaggregate 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.
M3 - Working paper
T3 - Discussion Paper Series, Department of Economics KU Leuven
BT - Individual welfare analysis for collective households
PB - Department of Economics, KU Leuven
ER -
ID: 188233514