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Changes in household composition as a shock-mitigating strategy

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  • Kseniya Abanokova
  • Michael Lokshin

Abstract

type="main" xml:id="ecot12067-abs-0001"> This paper uses data from the Russian Longitudinal Survey that span the two recent economic recessions of 1998 and 2008 to study the effect of declining incomes on household composition. We hypothesize that individuals face a trade-off between taking advantage of economies of scale and specialization when living with others, and individual privacy. Consumption smoothing is achieved by forgoing privacy during the crisis and results in increases in household size. Our empirical results suggest that members of households that experienced negative income shocks are more likely to move in with others compared to individuals residing in households whose income remained the same or increased.

Suggested Citation

  • Kseniya Abanokova & Michael Lokshin, 2015. "Changes in household composition as a shock-mitigating strategy," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 23(2), pages 371-388, April.
    • Handle: RePEc:bla:etrans:v:23:y:2015:i:2:p:371-388
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    File URL: http://hdl.handle.net/10.1111/ecot.2015.23.issue-2
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    Cited by:

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    2. Polina Kozyreva & Klara Sabirianova Peter, 2015. "Economic change in Russia: Twenty years of the Russian Longitudinal Monitoring Survey," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 23(2), pages 293-298, April.
    3. Stephanie von Hinke & George Leckie, 2017. "Protecting Calorie Intakes against Income Shocks," Bristol Economics Discussion Papers 17/684, School of Economics, University of Bristol, UK.

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    • J10 - Labor and Demographic Economics - - Demographic Economics - - - General

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