We investigate the relationship between the individual and household indirect utility functions in the context of a collective household model. Our analysis produces new results that explain how the rule governing the distribution of resources among household members is related to the measurement of household welfare and intra-household inequality. We show that in a collective model of private consumption, income shares are equal to the product of two weights: the Pareto weight and a distribution weight reflecting income effects across individuals. For a weighted Bergsonian representation of household utility and general assumptions about individual preferences, we derive the associated household welfare functions and intra-household inequality measures belonging to a family of entropy indexes. We illustrate our findings with an empirical application that estimates a collective demand system to recover associated individual and household welfare functions along with the measures of intra-household inequality. This is the first application that estimates the Pareto weight and examines its role within a measure of income dispersion among household members.We are grateful to Rolf Aaberge, Ugo Colombino, Stefan Hoderlein, Eleonora Matteazzi, Lars Nesheim, various seminar and conference participants, the editor, and three anonymous reviewers for helpful comments and suggestions. We also thank Nicola Tommasi for excellent research assistance. All errors and omissions are the sole responsibility of the authors.

No abstract

No abstract

The aim of this survey is to provide an overview of the main denitions of certainty equivalent and its applications in the one-dimensional and multidimensional framework. We also show the relationships between the concept of certainty equivalent and other denitions related to dierent elds. In particular, we focus on nancial and economic approaches that imply risk or inequality measurement.

We examine the properties ensuring that individual expenditure functions, derived within the context of the collective household model, are legitimate individual cost functions. Our curvature results are important for the characterization of collective demand functions as well and for the measurement of inequality within the household.