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The New Household Economics, General X-Efficiency Theory and Consumption in Developing Countries

In: Consumption and Development

Author

Listed:
  • Jeffrey James

    (Tilburg University)

Abstract

Associated mainly with the work of Gary Becker, the ‘new household economics’ views consumption as a process of ‘producing’ characteristics from purchased inputs and labour time.1 As such, it establishes a pioneering link between consumption and the theory of production. Among other things, this analogy enables one to analyse the efficiency with which the various activities in the household, such as cleaning, administering health care, cooking and feeding, are carried out. For, just as production by the firm may be more or less efficient, so too can households vary in the efficiency with which they conduct their various activities. When they are applied to activities that are closely related to basic needs (such as infant feeding or the provision of health care), these variations may help to explain the differential extent to which poor households are able to meet the basic needs (for hunger, thirst and so on) of their members and, more specifically, why education seems to be so important in accounting for these differences.

Suggested Citation

  • Jeffrey James, 1993. "The New Household Economics, General X-Efficiency Theory and Consumption in Developing Countries," Palgrave Macmillan Books, in: Consumption and Development, chapter 9, pages 182-198, Palgrave Macmillan.
  • Handle: RePEc:pal:palchp:978-1-349-22658-0_9
    DOI: 10.1007/978-1-349-22658-0_9
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