Discussion paper

DP15955 OLS Estimation of the Intra-Household Distribution of Expenditure

We develop a method to estimate resource shares — the fraction of total household
expenditure allocated to each household member — using OLS estimation of Engel
curves.
The method reframes the nonlinear model of Dunbar, Lewbel and Pendakur (2013),
extended to allow single parent households, scale economies in assignable goods, complementarities
between non assignable goods, and supplemented by a linear identification
test.
We apply the model to data from 12 countries, and investigate resource shares,
gender gaps, and poverty. We reject equal sharing, and find large gender gaps in
resource shares, and consequently in poverty rates, in some countries.

£6.00
Citation

Lechene, V, K Pendakur and A Wolf (eds) (2021), “DP15955 OLS Estimation of the Intra-Household Distribution of Expenditure”, CEPR Press Discussion Paper No. 15955. https://cepr.org/publications/dp15955