rational household labor supply traditionally household behavior is derived from the maximization of a unique utility function in this paper we propose an alternative approach in which the household is modeled as a two member collectivity taking pareto efficient decisions the consequences of this assumption are analyzed in a three good model in which only total consumption and each member s labor supply are observable if the agents are assumed egoistic i e they are only concerned with their own leisure and consumption it is possible to derive falsifiable conditions upon household labor supplies from both a parametric and nonparametric viewpoint if alternatively agents are altruistic restrictions obtain in the nonparametric context useful interpretation stems from the comparison with the characterization of aggregate demand for a private good economy

labor supply of husbands and wives a simultaneous equations approach labor supply functions for married men and women are formulated as a dynamic simultaneous equations system which is estimated using panel data controlling for fixed individual effects allows marginal labor supply responses to be disentangled from permanent patterns in hours worked due to assortative mating the results suggest that the labor supply of husbands and wives without pre school children is not jointly determined in the short run while families with young children exhibit strong interactions in work hours and negative cross earnings effects neither the joint utility model of family labor supply nor an ad hoc traditional family model is supported by these results the data are for the united states and concern 381 couples from the denver income maintenance experiment excerpt

household labor market choices and the demand for recreation this paper introduces household labor market choices into the demand for recre ation showing that the opportunity cost of time wage rate connection is severed when several household members have the opportunity to par ticipate in the labor market at fixed wages an ap plication of recreation demand for households in new bedford massachusetts shows that the rec reation demand models and estimates of con sumer surplus are sensitive to household labor market choices q26

two nested constant elasticity of substitution models of recreational participation and site choice an alternatives model and an expenditures model two demand modelsof recreational participation and s ite choice are developed an alternatives model and an expenditures model both assume maximization of utility over the year so allow for diminishing marginal utility they do not impose the restrictive assumption that where one goes on a trip isindependent of where one plansto go on other occas ions es timation iswith a nes ted constant elasticity of substitution preference ordering it is relatively easy to estimate because of global regularity it allowss itesto be complements and it hasthe potential to be locally flexible the application is to atlantic salmon fishing

the demand for site specific recreational activities a characteristics approach abstract a model of constrained utility maximizing behavior is developed to explain how a representative individual allocates his ski days among alternative sites the physical characteristics of the ski areas and the individual s skiing ability are explicit arguments in the utility function the budget allocation is given along with the parametric costs to ski including travel costs entrance fees equipment costs and the opportunity cost of his time shares a site s share being the proportion of ski days that the individual spends at that site are derived and assumed multinomially distributed a stochastic specification which maintains the inherent properties of the shares maximum likelihood estimation confirms the basic hypothesis that costs ability and characteristics all are important determinants of the sites shares the model explains a large proportion of the skier s allocation of ski days a multinomial logit model of skier behavior is also developed and maximum likelihood estimates of its parameters are obtained examination of the summary statistics from my model and the logit model indicates that my model predicts the skier s choice of sites better than the logit model

altruism within the family reconsidered do nice guys finish last this paper criticizes the view that altruism either increases the benefits of group interactions or improves the allocation of resources within families the authors identify a variety of circumstances in which members of a group would prefer to interact with less altruistic individuals and in which the efficiency of resource allocation is inversely related to the prevailing degree of altruism reasons that altruism might be a counter productive social force include 1 it can alter the social utility possibility frontier in surprising and sometimes unfortunate ways 2 it can entail exploitability causing family members to behave in ways that leave all parties worse off 3 altruists may take inefficient actions to preempt exploitation and 4 family members may establish efficient resource allocation by punishing selfish behavior a rise in the level of altruism may lead to the exclusion of certain punishment strategies on the grounds of credibility 1 general positive result is that sufficiently high levels of altruism almost always lead to efficient resource allocation one should not necessarily expect to find strong altruistic linkages between spouses nor should altruism necessarily contributed to marital stability in addition to the connections between this work and the literature on family behavior this analysis has broader implications concerning the role of altruism in society and the evolution of social conscience

love and spaghetti the opportunity cost of virtue author s bergstrom ted abstract this paper was written in the form of two puzzles one puzzle concerns romeo and juliet who love spaghetti and each other they wear flimsy clothing and have abdominal hedonimeters the other puzzle asks who benefits from tax deductions to the rich for charitable deductions

recovering individual preferences for non market goods a collective travel cost model traditional recreation demand models do not make a distinction between a household and an individual as the reference decision making unit thus assuming that a family maximizes a single utility function even if the family consists of different individuals such models ignore the possibility of family members divergent preferences for non market goods this study proposes a novel approach the collective travel cost model ctcm to eliciting individual preferences for a non market good such as a recreation site by using revealed preference data this approach accounts for the intra household resource allocation and the role of each household member s preferences we show that the collective travel cost model can be applied to estimating a recreation demand model that yields individual welfare estimates appropriate for policy analysis of non market goods such as the willingness to pay to access a recreation site we find that how resources are distributed within the household reflects significant differences in welfare measures

estimation and welfare analysis with large demand systems we develop an approach for estimating individual or household level preferences for a large set of quality differentiated goods and for constructing hicksian welfare measures within the demand system framework our approach uses a maximum simulated likelihood procedure to recover estimates of the structural parameters and a multistage monte carlo markov chain algorithm for constructing hicksian consumer surplus estimates we illustrate our approach with a recreation dataset consisting of day trips to 62 mid atlantic beaches

stage financing and the role of convertible securities venture capital financing is characterized by extensive use of convertible securities and stage financing in a model where a venture capitalist provides staged financing for a project we illustrate an advantage of convertible debt or warrants over a mixture of debt and equity essentially when the venture capitalist retains the option to abandon the project the entrepreneur has an incentive to engage in window dressing and bias positively the short term performance of the project reducing the probability that it will be liquidated an appropriately designed convertible security prevents such behaviour because window dressing also increases the probability that the venture capitalist will exercise the conversion option becoming the owner of a substantial fraction of the project s equity

recovering hicksian consumer surplus within a collective model hausman s method for the household the purpose of this paper is to describe the implications of the collective model of household behavior for the methods used to estimate the economic value of non marketed environmental resources after demonstrating how the separability restrictions inherent in the collective model allow individual preference and household income allocation choices to be distinguished the paper demonstrates how the framework can be used to recover hicksian consumer surplus an algebraic example is used to illustrate how the framework can be used in valuing environmental resources

child health and household resources in south africa evidence from the old age pension program this paper presents nonparametric evidence on the effects of the expansion of the old age pension program in south africa on child health did this increase in household resources improve child health and nutrition does the gender of the recipient of the pension affect its impact the answers to these questions have very important policy implications there is evidence that inadequate nutrition during childhood and even in utero affects long term physical development as well as the development of cognitive skills this in turn affects productivity later in life see partha dasgupta 1993 john strauss and duncan thomas 1998 t paul schultz 1999 in the united states the evidence suggests that monetary transfers to the poor have very little impact on child welfare janet currie 1995 susan mayer 1997 however the effects of parental income and monetary transfers on child outcomes are likely to be of greater magnitude among poor households in developing countries the south african pension program provides an unusual opportunity to evaluate the possible effects of such a monetary transfer this paper exploits the rapid increase in the coverage and benefits of the old age pension program in south africa which took place in the early 1990 s anne case and angus deaton 1998 at the end of the apartheid era the government committed to achieving parity of benefits and eligibility requirements between whites and africans this was achieved mostly by increasing the benefits received by the africans in 1993 80 percent of african women above age 60 and 77 percent of african men above 65 received the pension the maximum benefit of 370 rands per month aproximately 3 per day was equal to half of the minimum wage and about twice the median income per capita in rural areas due to living arrangements inherited from the apartheid era close to onethird of african children under the age of 5 currently live with a pension recipient children who live with a pension recipient tend to come from relatively disadvantaged backgrounds as a consequence they tend to be smaller than other children their age to estimate the effect of receiving a pension on the anthropometric status of children this paper exploits the fact that height reflects accumulated investments in child nutrition the larger the proportion of her life during which a child is well nourished the taller she will be given her age due to the expansion of the program in the early 1990 s individuals of qualified age became more likely to receive a pension and the benefits became substantially larger thus children born after the expansion of the program are more likely to have spent a larger fraction of their lives wellnourished if they live with a pension recipient to the extent that the pension resulted in improved nutrition in this paper i present nonparametric evidence of the program s effect on nutrition based on this observation

children s resources in collective households identification estimation and an application to child poverty in malawi children s resources matter but they are hard to identify because consumption is typically mea sured at the household level modern collective household models permit some identication of indi vidual household member resources but these models typically either ignore children or treat them as attributes of adults we propose a collective household model in which children are people with their own utility functions possibly assigned to them by parents extending the frameworks of browning chiappori and lewbel 2007 and lewbel and pendakur 2008 we show identication of children s resource shares within households we invoke semiparametric restrictions on individual preferences and use data on the household level consumption of assignable private goods to achieve identication of each individual s resource share within the household we show this without being able to observe consumption by individual household members of goods that are partly or wholly shared goods within the household further we obtain identication using only engel curves and so do not require ob served price variation in the data we estimate our model using data from malawi andnd that as the number of children in a household grows women s resource shares fall and children s resource shares rise and men s resource shares are basically unchanged we alsond evidence of gender bias against girls and observe that the resource shares of mothers and children are increasing in the education level of the mother finally we use our estimates to construct poverty indices at the person level andnd that per capita poverty indices understate the incidence of child poverty in malawi

collective labor supply and welfare the paper develops a general collective model of household labor supply in which agents are characterized by their own possibly altruistic preferences and household decisions are only assumed to be pareto efficient an alternative interpretation is that there are two stages in the internal decision process agents first share nonlabor income according to some given sharing rule then each one optimally chooses his or her own labor supply and consumption this setting is shown to generate testable restrictions on labor supplies moreover the observation of labor supply behavior is sufficient for recovering individual preferences and the sharing rule up to a constant finally the traditional tools of welfare analysis can be adapted to the new setting

time and the recreational demand model in this paper a theoretically consistent approach to including time costs in recreational demand models is developed the demand model is conditional on the recreationist s labor market situation for individuals at corner solutions in the labor market utility maximization is subject to two constraints leading to a demand function with travel costs and travel time as independent variables with interior solutions in the labor market time is valued at the wage rate and combined with travel costs to produce one full cost variable in an illustration welfare measures based on the new model are estimated for a sample of sportfishermen

gender agricultural production and the theory of the household virtually all models of the household assume that the allocation of resources is pareto efficient within many african households agricultural production occurs on many plots controlled by different members of the household pareto efficiency implies that factors should be allocated efficiently across these plots i find in contrast that plots controlled by women are farmed much less intensively than similar plots within the household controlled by men the estimates imply that about 6 percent of output is lost because of inefficient factor allocation within the household the paper suggests a new approach to modeling intrahousehold allocation consistent with the empirical results

household willingness to pay equals individual willingness to pay if and only if the household income pools abstract i show household and individual willingness to pay are equal if and only if household choices satisfy income pooling providing a test of whether the individual respondent speaks for the household an assumption implicit in much stated preference practice

a test of the unitary and collective models of household labour supply this paper tests the unitary and the collective household labour supply models within a structural framework a nonlinear unrestricted household labour supply system is postulated and the set of parametric restrictions imposed by each model is derived our results generally reject the income pooling restrictions embodied in the unitary model also the symmetry of cross wage effects is rejected however the collective model is not rejected for groups with no pre school children

a dual approach to modeling corner solutions in recreation demand abstract the dual approach of lee and pitt to estimating demand systems for which individuals often choose not to consume one or more of the available goods provides a utility consistent framework for estimating preferences over visits to recreation sites because of the complexity of the model however this approach has not been applied in the recreation demand literature this paper provides the first application of the model to recreation demand and develops a methodology for conducting welfare analysis relying on monte carlo integration to derive estimates of compensating variation the methods are applied to the demand for fishing in the wisconsin great lakes region

intra household resource allocation an inferential approach if household income is pooled and then allocated to maximize welfare then income under the control of mothers and fathers should have the same impact on demand with survey data on family health and nutrition in brazil the equality of parental income effects is rejected unearned income in the hands of a mother has a bigger effect on her family s health than income under the control of a father for child survival probabilities the effect is almost twenty times bigger the common preference or neoclassical model of the household is rejected if unearned income is measured with error and income is pooled then the ratio of maternal to paternal income effects should be the same equality of the ratios cannot be rejected there is also evidence for gender preference mothers prefer to devote resources to improving the nutritional status of their daughters fathers to sons

the value of automobile travel time implications for congestion policy abstract public policy has remained stoutly resistant to the economic profession s call to use congestion tolls to minimize the social costs from automobile congestion this paper explores this issue by using stated preference models to estimate the value that commuters are willing to pay to save travel time we find that this value is low and surprisingly insensitive to travel conditions and how toll revenues are used it appears that even high income commuters having adjusted to congestion through their modal residential workplace and departure time choices simply do not value travel time savings enough to benefit substantially from tolls

self interest public interest and public health although the activities of physicians as represented by the ama have long been viewed from a self interest perspective by economists public health processes have not been subjected to such an examination but just as the conduct of ostensibly charitable hospitals cannot be examined independently of the interests of the physicians who staff them so too we think the conduct of public health bureaus should not be examined in isolation from the interests of the medical community that they represent an interest group interpretation of public health would look to the ways in which public health processes increase the aggregate demand for medical services thereby generating quasirents for specialized input suppliers we have explored in preliminary fashion some ways in which public health agencies may advance the collective interests of physicians though we would be the first to acknowledge that much work remains to be done on this topic

a theory of competition among pressure groups for political influence this paper presents a theory of competition among pressure groups for political influence political equilibrium depends on the efficiency of each group in producing pressure the effect of additional pressure on their influence the number of persons in different groups and the deadweight cost of taxes and subsidies an increase in deadweight costs discourages pressure by subsidized groups and encourages pressure by taxpayers this analysis unifies the view that governments correct market failures with the view that they favor the politically powerful both are produced by the competition for political favors

a unified approach to incorporating demographic or other effects into demand systems a general method of introducing demographic effects into any demand system using modifying functions is described which permits complicated interactions of demographic variables with prices and expeditures theorems give properties the modifying functions must have to ensure integrability of the resulting system demand equations of the new system are given explicitly as functions of the original demand equations and the modifying functions the procedure is interpreted as altering a households technology and is shown to encompass adult equivalent scales and related methods examples of modifying functions are derived and applications of the technique to uses other than demographic variation are considered excerpt

household willingness to pay and income pooling a comment abstract we demonstrate some problems with munro 2005 household willingness to pay equals individual willingness to pay if and only if the household income pools economics letters 88 227 230 furthermore we reconsider income pooling in a slightly changed framework and prove income pooling implies that household willingness to pay is equal to minimal individual willingness to pay the converse is not true

estimation of complete demand systems from household budget data the linear and quadratic expenditure systems in this paper we explore two issues in empirical demand analysis the estimation of complete systems of demand equations using household budget data section i and the incorporation of demographic characteristics into such systems section ii although there are numerous studies which use time series data to estimate complete demand systems and many which estimate engel curves from household budget data there are virtually none which combine budget data from different periods to estimate complete systems since each budget study corresponds to a single price situation one might conjecture that estimation of complete systems would not be possible unless budget studies were available from a large number of periods this is incorrect in section i we argue that interesting complete demand systems can be estimated from a small number of budget studies despite the limited price variability represented in such data to demonstrate this we use budget study data for two periods to estimate a pair of related demand systems the familiar linear expenditure system les and a quadratic expenditure system qes a generalization of les in which the demand equations are quadratic in total expenditure the inclusion of demographic variables in the analysis of household consumption patterns is desirable because there are likely to be systematic differences in the consumption behavior of households with different demographic characteristics but the effects of demographic characteristics have seldom been studied within the framework of complete demand systems in section ii we propose translating as a general method for incorporating demographic variables into complete systems of demand equations this method has not previously been discussed as a general technique for bringing demographic variables into demand systems although it has been employed in several studies to improve the estimates of the les and the qes presented in section i we reestimate these two systems using translating to incorporate family size

rents from in kind subsidy charity in the public sector public choice analysis usually focuses attention on the behaviour of self interested individuals but this paper considers rent seeking when some taxpayers are motivated by altruism redistribution policies initiated by self interested rent seekers require taxpayer approval even if taxpayers are fully informed their resistance to inefficient schemes is reduced when public sector schemes are the only means available to pursue altruistic goals altruism serves to broaden the scope within which rent seekers may operate a discussion of international tied aid illustrates the impact which rent seeking can exert on public sector charity