Intrahousehold Inequality

Abstract

Studies of inequality often ignore resource allocation within the household. In doing so they miss an important element of the distribution of welfare that can vary dramatically depending on overall environmental and economic factors. Thus, measures of inequality that ignore intra household allocations are both incomplete and misleading. We discuss determinants of intrahousehold allocation of resources and welfare. We show how the sharing rule, which characterizes the within household allocations, can be identified from data on household consumption and labor supply. We also argue that a measure based on estimates of the sharing rule is is inadequate as an approach that seeks to understand how welfare is distributed in the population because it ignores public goods and the allocation of time to market work, leisure and household production. We discuss a money metric alternative, that fully characterizes the utility level reached by the agent. We then review the current literature on the estimation of the sharing rule based on a number of approaches, including the use of distribution factors as well as preference restrictions.

Stacking up the ladder: A panel data analysis of Tanzanian household energy choices

“…In the context of Tanzania, recent evidence shows the importance of intra-household bargaining on household decisions related to farming (Anderson et al, 2017), and more generally theoretical research highlights the relationship between intra-household distribution of power and household behaviour (Chiappori and Meghir, 2014). Moreover, there is an established literature showing that women carry out most of the house-related work in Tanzania (Budlender, 2010).…”

Macroeconomic policy tools to finance gender equality

“…Research identifies a strong link between physical infrastructure expenditures, women's unpaid care burden and the growth of potential output (Agénor, Canuto, & da Silva, ). Targeted investments can reduce women's unpaid labour burden, freeing up time to spend in remunerative labour activities, with benefits for gender equality and intrahousehold bargaining power (Chiappori & Meghir, ). Children's well‐being and economy‐wide long‐run productivity growth also benefit.…”

Wages and Family Time Allocation

“…Much of the notation is already introduced; the remaining notation is as follows: (i) in the budget constraint A t is household common assets, w jt is spouse j's hourly wage at t, h jt is his/her hours of market work, CC t h 2t , N t is child care costs that families with young children may have to meet (N t summarizes the family composition; more on this to follow), r is the deterministic and known market interest rate, and A is a borrowing limit; (ii) in the participation constraintsŪ j (•) is the utility individual j can get from his/her outside option at t. The above program is written as if household member 1 makes all the choices in the household which obviously goes against the collective spirit. Decentralization is feasible but requires a combination of Lindahl (personal) and shadow prices for Q because this is a good that is both public and domestic (see Chiappori and Meghir, 2014).…”

“…A recent review of this literature, including static and dynamic collective models, is provided byBrowning et al (2014) andChiappori and Mazzocco (2017) Lise and Seitz (2011). andChiappori and Meghir (2014) argue why the intra-household allocation of resources should not be ignored.9 Important earlier papers in this strand of literature also includeEckstein and Wolpin (1989), who model women's labor force participation and fertility choices when current participation affects future earnings, and van derKlaauw (1996), who models women's labor force participation jointly with their marital choices.…”