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Unpacking Household Engel Curves

Author

Listed:
  • Philippe De Vreyer
  • Sylvie Lambert
  • Martin Ravallion

Abstract

The classic Working-Leser household Engel curve is unpacked to reveal individual budget allocations across commodities as a function of both individual and household total spending. Two main findings emerge on calibrating our model to an unusual sub-household dataset for Senegal. First, for all except education spending, our results are consistent with the separable structures found in two-stage bargaining and collective models of the household. Second, there are large biases in standard household Engel-curve estimates when compared to consistently aggregated sub-household estimates, though in differing degrees and directions depending on the type of commodity. The main source of bias is a household effect on sub-household spending behavior, though this is partially offset by a bias due to intra-household inequality, which emerges as a confounder in aggregating to the household level.

Suggested Citation

  • Philippe De Vreyer & Sylvie Lambert & Martin Ravallion, 2020. "Unpacking Household Engel Curves," NBER Working Papers 26850, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:26850
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    Cited by:

    1. Clemens, Michael A., 2020. "The Emigration Life Cycle: How Development Shapes Emigration from Poor Countries," IZA Discussion Papers 13614, Institute of Labor Economics (IZA).
    2. Calvi, Rossella & Penglase, Jacob & Tommasi, Denni & Wolf, Alexander, 2023. "The more the poorer? Resource sharing and scale economies in large families," Journal of Development Economics, Elsevier, vol. 160(C).
    3. Kabeya Clement Mulamba, 2022. "Relationship between households’ share of food expenditure and income across South African districts: a multilevel regression analysis," Palgrave Communications, Palgrave Macmillan, vol. 9(1), pages 1-11, December.
    4. Rossella Calvi & Jacob Penglase & Denni Tommasi & Alexander Wolf, 2020. "Resource Sharing and Scale Economies in Large Families," SoDa Laboratories Working Paper Series 2020-09, Monash University, SoDa Laboratories.
    5. Echeverría, Lucía, 2020. "Modelos colectivos de consumo y distribución intra-hogar. Teoría y aplicaciones," Nülan. Deposited Documents 3832, Universidad Nacional de Mar del Plata, Facultad de Ciencias Económicas y Sociales, Centro de Documentación.
    6. Emilia Madudova & Tatiana Corejova, 2023. "The Issue of Measuring Household Consumption Expenditure," Economies, MDPI, vol. 12(1), pages 1-15, December.

    More about this item

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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