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Allocation of Expenditures in Elderly Households and the Cost of Widowhood

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  • Daniel Burkhard

    (University of Bern
    CONCORDIA Versicherungen AG)

Abstract

Summary Widowhood and retirement change the economie environment of elderly households. While retirement changes income and expenditure patterns, widowhood fundamentally changes the structure of the household. Besides high non-monetary cost of losing the partner, resources are no longer shared and economies of scale arising from joint consumption are lost. This paper applies a collective household model to expenditure data on elderly households in Switzerland. The findings suggest that 44% of household resources are assigned to wives and both spouses save roughly 27% or, on average, 800 Swiss Francs on monthly expenditures relative to living apart. Estimates of indifference scales indicate that men suffer a financial loss after losing their wife, while widowed women do not.

Suggested Citation

  • Daniel Burkhard, 2017. "Allocation of Expenditures in Elderly Households and the Cost of Widowhood," Swiss Journal of Economics and Statistics, Springer;Swiss Society of Economics and Statistics, vol. 153(4), pages 371-401, October.
    • Handle: RePEc:spr:sjecst:v:153:y:2017:i:4:d:10.1007_bf03399512
    DOI: 10.1007/BF03399512
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    References listed on IDEAS

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    Cited by:

    1. Marlena Piekut, 2020. "Living Standards in One-Person Households of the Elderly Population," Sustainability, MDPI, vol. 12(3), pages 1-26, January.

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    More about this item

    Keywords

    Jel-Classification; D12; D13; C30;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • C30 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - General

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