IDEAS home Printed from https://ideas.repec.org/a/spr/stmapp/v10y2001i1d10.1007_bf02511649.html
   My bibliography  Save this article

De gustibus non est disputandum? A new approach to the estimation of equivalence scales

Author

Listed:
  • Mauro Maltagliati

    (Department of Statistics “G. Parenti”)

  • Gustavo Santis

    (Un. of Messina)

Abstract

We argue that when the household composition changes, consumption patterns vary not only because of the cost effect that equivalence scales try to measure, but also because of a “taste” or “style” effect. This effect can be identified and measured, under a few assumptions, with the use of a new methodology, calledDM 2 (Decomposition Model of the effects of Demographic Metamorphosis), that can be viewed as a generalisation of Ray's (1983) price-scaling approach to the construction of equivalent scales. An empirical application to data drawn from the Istat 1995 Italian Household Budget Survey suggests that the proposed method improves our understanding of households' consumption patterns and the reliability of the equivalence scales that we derive.

Suggested Citation

  • Mauro Maltagliati & Gustavo Santis, 2001. "De gustibus non est disputandum? A new approach to the estimation of equivalence scales," Statistical Methods & Applications, Springer;Società Italiana di Statistica, vol. 10(1), pages 211-236, January.
  • Handle: RePEc:spr:stmapp:v:10:y:2001:i:1:d:10.1007_bf02511649
    DOI: 10.1007/BF02511649
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/BF02511649
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.

    File URL: https://libkey.io/10.1007/BF02511649?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. FranÚois Bourguignon, 1999. "The cost of children: May the collective approach to household behavior help?," Journal of Population Economics, Springer;European Society for Population Economics, vol. 12(4), pages 503-521.
    2. Geoffrey Lancaster & Ranjan Ray & Maria Rebecca Valenzuela, 1999. "A Cross‐Country Study Of Equivalence Scales And Expenditure Inequality On Unit Record Household Budget Data," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 45(4), pages 455-482, December.
    3. Hilde Bojer & Julie A. Nelson, 1999. "Equivalence Scales And The Welfare Of Children: A Comment On “Is There Bias In The Economic Literature On Equivalence Scales?”," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 45(4), pages 531-534, December.
    4. Tullio Jappelli, 1999. "The Age‐Wealth Profile And The Life‐Cycle Hypothesis: A Cohort Analysis With A Time Series Of Cross‐Sections Of Italian Households," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 45(1), pages 57-75, March.
    5. C. Andrea Bollino & Federico Perali & Nicola Rossi, 2000. "Linear household technologies," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 15(3), pages 275-287.
    6. Gary S. Becker, 1981. "A Treatise on the Family," NBER Books, National Bureau of Economic Research, Inc, number beck81-1.
    7. repec:bla:revinw:v:44:y:1998:i:2:p:183-98 is not listed on IDEAS
    8. Browning, Martin & Francois Bourguignon & Pierre-Andre Chiappori & Valerie Lechene, 1994. "Income and Outcomes: A Structural Model of Intrahousehold Allocation," Journal of Political Economy, University of Chicago Press, vol. 102(6), pages 1067-1096, December.
    9. Pollak, Robert A & Wales, Terence J, 1981. "Demographic Variables in Demand Analysis," Econometrica, Econometric Society, vol. 49(6), pages 1533-1551, November.
    10. Pollak, Robert A & Wales, Terence J, 1980. "Comparison of the Quadratic Expenditure System and Translog Demand Systems with Alternative Specifications of Demographic Effects," Econometrica, Econometric Society, vol. 48(3), pages 595-612, April.
    11. repec:bla:revinw:v:45:y:1999:i:4:p:455-82 is not listed on IDEAS
    12. Deaton, Angus S & Muellbauer, John, 1986. "On Measuring Child Costs: With Applications to Poor Countries," Journal of Political Economy, University of Chicago Press, vol. 94(4), pages 720-744, August.
    13. Pollak, Robert A & Wales, Terence J, 1979. "Welfare Comparisons and Equivalence Scales," American Economic Review, American Economic Association, vol. 69(2), pages 216-221, May.
    14. Ray, Ranjan, 1983. "Measuring the costs of children : An alternative approach," Journal of Public Economics, Elsevier, vol. 22(1), pages 89-102, October.
    15. James Banks & Richard Blundell & Arthur Lewbel, 1997. "Quadratic Engel Curves And Consumer Demand," The Review of Economics and Statistics, MIT Press, vol. 79(4), pages 527-539, November.
    16. Blundell,R. W. & Preston,Ian & Walker,Ian (ed.), 1994. "The Measurement of Household Welfare," Cambridge Books, Cambridge University Press, number 9780521451956.
    17. Rossi, Nicola, 1988. "Budget share demographic translation and the aggregate almost ideal demand system," European Economic Review, Elsevier, vol. 32(6), pages 1301-1318, July.
    18. Geoffrey Lancaster & Ranjan Ray, 1998. "Comparison of Alternative Models of Household Equivalence Scales: The Australian Evidence on Unit Record Data," The Economic Record, The Economic Society of Australia, vol. 74(224), pages 1-14, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Christian Dudel & Jan Marvin Garbuszus & Julian Schmied, 2021. "Assessing differences in household needs: a comparison of approaches for the estimation of equivalence scales using German expenditure data," Empirical Economics, Springer, vol. 60(4), pages 1629-1659, April.
    2. Garcia-Diaz Rocio, 2012. "Demand-Based Cost-of-Children Estimates and Child Poverty," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 12(1), pages 1-32, January.
    3. Pashardes, Panos, 1995. "Equivalence scales in a rank-3 demand system," Journal of Public Economics, Elsevier, vol. 58(1), pages 143-158, September.
    4. Lucia Mangiavacchi & Luca Piccoli, 2009. "Child welfare and intra-household inequality in Albania," Working Papers 149, ECINEQ, Society for the Study of Economic Inequality.
    5. Mangiavacchi, Lucia & Piccoli, Luca, 2011. "Improving the measurement of child welfare in the context of intra-household inequality," Children and Youth Services Review, Elsevier, vol. 33(2), pages 226-232, February.
    6. Antonella Caiumi & Federico Perali, 2015. "Who bears the full cost of children? Evidence from a collective demand system," Empirical Economics, Springer, vol. 49(1), pages 33-64, August.
    7. Tarek Atalla, Simona Bigerna, Carlo Andrea Bollino, and Rolando Fuentes, 2017. "Analyzing the Effects of Renewable Energy and Climate Conditions on Consumer Welfare," The Energy Journal, International Association for Energy Economics, vol. 0(KAPSARC S).
    8. Majumder, Amita & Chakrabarty, Manisha, 2003. "Relative cost of children: the case of rural Maharashtra, India," Journal of Policy Modeling, Elsevier, vol. 25(1), pages 61-76, January.
    9. Bargain, Olivier & Donni, Olivier, 2012. "Expenditure on children: A Rothbarth-type method consistent with scale economies and parents' bargaining," European Economic Review, Elsevier, vol. 56(4), pages 792-813.
    10. Thomas F. Crossley & Krishna Pendakur, 2002. "Consumption Inequality," Department of Economics Working Papers 2002-09, McMaster University.
    11. BARGAIN Olivier & DONNI Olivier, 2010. "The Measurement of Child Costs: A Rothbarth-Type Method Consistent with Scale Economies and Parents’ Bargaining," LISER Working Paper Series 2010-30, Luxembourg Institute of Socio-Economic Research (LISER).
    12. Tarek Atalla & Simona Bigerna & Carlo Andrea Bollino & Rolando Fuentes, 2017. "Analyzing the effects of renewable energy and climate conditions on consumer welfare," The Energy Journal, , vol. 38(1_suppl), pages 115-136, June.
    13. Sunil Kumar & Renuka Mahadevan, 2008. "Construction of An Adult Equivalence Index to Measure Intra-household Inequality and Poverty: Case Study," Discussion Papers Series 363, School of Economics, University of Queensland, Australia.
    14. Martina Menon & Federico Perali & Luca Piccoli, 2008. "The passive drinking effect: Evidence from Italy," Working Papers halshs-00586686, HAL.
    15. Apps, Patricia, 2003. "Gender, Time Use and Models of the Household," IZA Discussion Papers 796, Institute of Labor Economics (IZA).
    16. Martin Browning & Pierre-André Chiappori & Arthur Lewbel, 2013. "Estimating Consumption Economies of Scale, Adult Equivalence Scales, and Household Bargaining Power," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 80(4), pages 1267-1303.
    17. White, Howard & Masset, Edoardo, 2002. "Child poverty in Vietnam: using adult equivalence scales to estimate income-poverty for different age groups," MPRA Paper 777, University Library of Munich, Germany.
    18. Echeverría, Lucía & Menon, Martina & Perali, Federico & Berges, Miriam, 2019. "Intra-household inequality and child welfare in Argentina," Nülan. Deposited Documents 3051, Universidad Nacional de Mar del Plata, Facultad de Ciencias Económicas y Sociales, Centro de Documentación.
    19. Fabrizio Balli, 2012. "Are Traditional Equivalence Scales Still Useful? A Review and A Possible Answer," Department of Economics University of Siena 656, Department of Economics, University of Siena.
    20. Bruce Bradbury, 2003. "The welfare interpretation of consumer equivalence scales," International Journal of Social Economics, Emerald Group Publishing Limited, vol. 30(7), pages 770-787, July.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:stmapp:v:10:y:2001:i:1:d:10.1007_bf02511649. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.