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Three essays on the geography of household consumption decisions

By Jose Maria Casado Garcia

Abstract

This thesis analyses in three essays how some household consumption decisions are conditional upon their geographical location and the consumption behaviour of the households around them. I first explore the relevance of the neighbourhood and habit effects on consumption choices under the hypothesis that the level of satisfaction derived from a given bundle of consumption depends, not only on the consumption bundle itself, but also on how it compares to the bundles of consumption of some reference group and to the agents own past bundle of consumption. I derive a Euler equation from a preference specification that allows for non-separabilities across households and non-separabilities over time. Our estimates suggest that a large fraction of the utility derived from consumption is relative, with one-forth of the weight in the consumption of the reference group and almost one- third in the agent's past consumption. The second paper computes the asymmetrical geographical distribution of the partial insurance capacity of households' consumption. Households have mechanisms to smooth changes in consumption when incomes shift as a result of permanent or transitory shocks. Results show how it is the Southern Spanish regions where households with the lowest insurance capacity with respect to permanent shocks are concentrated. Further, the asymmetric geographical distribution of insurance capacity becomes more evident when we distinguish between age or educational attainment. Finally, the third paper analyses the residential and transport energy consumption in relation to the geographical location of households. I find higher energy efficiency for urban households, and a deeper carbon footprint for rural families. Therefore, there is evidence of a causal effect in the sense of whether making a city bigger makes its citizens more energy efficient or whether moving people to bigger cities makes these people more energy efficient and environmental friendly.EThOS - Electronic Theses Online ServiceGBUnited Kingdo

Topics: 05D - Economics, economic theory, 05O - Architecture
Year: 2011
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Provided by: OpenGrey Repository
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