Individual Decisions and Household Demand for Consumption And Leisure

The standard microeconomic assumption of a household utility function raises two theoretical problems: it contradicts methodological individualism and it ignores economic phenomena like income and consumption sharing, division of labour, externalities and altruism within a household. This paper reviews two approaches, aggregation theory and more recent non-unitary models, to compare the different properties that household consumption and leisure demands have to satisfy in the two basic contexts. The paper also discusses some recent empirical evidence which seems to encourage further investigation in the non-unitary framework.consumption, labour supply, intra- household allocation

Intra-Household Allocation of Time and Resources: Empirical Evidence on a Sample of Italian Households with Young Children

This paper examines the labour supply decision of the household when the presence of pre-school children, creating non-separabilities in the use of time, is explicitly taken into account. A set of nested tests is obtained from the standard household utility model and from the collective one, both including a household production function measuring the quality of time provided to the children. The application of the tests to a sample of Italian households shows that the collective model considered in this paper cannot be rejected. For this demographic group we also find enough evidence against the income pooling hypothesis and against the Slutsky inter-person symmetry condition. However, the identification of the income sharing parameters shows that the distribution of the household non-labour income does not affect the household labour supply system. We also provide a measure of the bias implicit in the standard household utility approach, by comparing the labour supply elasticiticies obtained from the two models.Household labour supply, children

Labor market time and home production: A new test for collective models of intra- household allocation

The allocation of time is a crucial decision that influences many aspects of household welfare, above all consumption, income level and home production. This paper presents a new methodology to estimate woman domestic productivity using a French time use survey, at least whenever the recursivity property for constrained utility maximization with home production applies. It provides empirical evidence not rejecting a collective model of household decision making over working time, as the sum of time spent in domestic production and market labor time. Our results show also that female domestic productivity is a relevant variable explaining intra-household distribution of resources.Collective models, home production, time- use

Financial Market Imperfections and Home Ownership: A Comparative Study

We explore the determinants of the international pattern of homeownership using the Luxembourg Income Study (LIS), a collection of microeconomic data on fourteen OECD countries. In most of these countries the cross-section is repeated over time. This allows us to construct a truly unique international dataset on over 400,000 households. The dataset also includes selected demographic variables (carefully matched between the different surveys). After controlling for individual-country effects, cohort effects and calendar time effects, we find strong evidence that different downpayment ratios affect the age-profile of housing tenure, particularly for the young.homeownership, financial markets

Welfare analysis of fiscal reforms in Europe: Does the representation of family decision processes matter? Evidence from Italy

This paper adopts a "piece-meal" approach to empirically identify, on a sample of Italian households, a collective model where both nonparticipation and non-convex budget sets are allowed for. Two tax reforms, i.e. the 2002 tax changes recently introduced in Italy and a revenue neutral linear income tax are evaluated by the collective framework derived. The predictions obtained for individual labour supplies, income and welfare distribution are then compared with those of a traditional unitary model. The exercise provide an assessment of the distortion introduced in positive and normative analyses when individuals are assumed to behave as if in a unitary, rather than in a collective world. The results suggest that further efforts should be devoted to the analysis of intra-household decision models.collective models; intra household allocation; tax reform

Financial Markets, Judicial Costs and Housing Tenure: An International Comparison

This paper explores the determinants of international patterns of housing tenure choice. Up to now, no study has carried out an international comparison in housing tenure using household level data. The Luxembourg Income Study (LIS) provides microeconomic data on fourteen OECD countries. In most of these countries the cross-section is repeated over time. This allows us to construct a truly unique international dataset on over 400,000 households. The dataset also includes selected demographic variables (carefully matched between the different surveys). After controlling for fixed-country effects, cohort effects and calendar time effects, we find strong evidence that different downpayment ratios affect the age-profile of housing tenure, particularly for the young.homeownership ; financial markets ; judicial costs

Living arrangements in Europe: exploring gender differences and institutional characteristics

While several social, economic and financial indicators point to a growing convergence among European countries, striking differences still emerge in the timing of leaving home for adult children. In Southern countries (as Spain, Italy or Portugal) in 2001 more than 70 percent of young adults between 18 and 34 years of age live with their parents, whereas the corresponding number for Northern countries (like Denmark or the UK) is well below 40 percent. Existing literature highlights several factors explaining the different patterns in Europe: preferences and culture, labor market conditions, housing market as well as differences across the welfare states. In our work, we consider living arrangements of people 18-34 years old from 14 European countries (ECHP). We augment the informational content with indicators of labor, housing and marriage markets characteristics as well as proxy for the welfare states and culture. We investigate how they are intertwined with gender differences.

Home-leaving Decision of Daughters and Sons

In spite of relevant differences between countries, a common international pattern emerges: daughters leave parental homes earlier than sons. Drawing upon the European Community Household Panel, we explore the impacts of various factors that affect daughters' and sons' home-leaving decisions. Results show that the decisions of daughters appear to be more responsive to environmental factors than sons'. This implies that policies aiming to speed up the transition to adulthood might have important economic impact on the existing gender differences in family formation and household responsibilities and income inequality across young men and women.Living Arrangements; Gender; Social Policies

Household Membership Decisions of Adult Children: Does Gender and Institutions Matter?

While several social, economic and financial indicators point to a growing convergence among European countries, striking differences still emerge in the timing of leaving home for adult children. In Southern countries (as Spain, Italy or Portugal) in 2001 more than 70 percent of young adults between 18 and 34 years of age live with their parents, whereas the corresponding number for Northern countries (like Denmark or the UK) is well below 40 percent. Existing literature highlights several factors explaining the different patterns in Europe: preferences and culture, labor market conditions, housing market as well as differences across the welfare states. In our work, we consider living arrangements of people 18-34 years old from 14 European countries (ECHP). We augment the informational content with indicators of labor, housing and marriage markets characteristics as well as proxy for the welfare states and culture. We investigate how they are intertwined with gender differencescoups, Living arrangements,duration analysis, government expenditures.

The Economic effects of a Local Minimum Income Support Program

Since Reddito Minimo d'Inserimento pilot experiment ended, a number of papers have attempted to study minimum income policies in Italy. Contributions have aimed at providing insight for possible future program implementations. In this paper we present a case study as an applied contribution to this debate. We analyze a minimum income support program implemented in a small town in the South of Italy, Mola di Bari, by using a new dataset which has been designed and collected for the purpose. With respect to the program, we describe the policy intervention and we analyze such issues as (i) the eligibility criteria, (ii) the targeting choices and results, (iii) the distributive and the welfare effects on the beneficiaries and on the overall town population (iv) the incentive effects, i.e. the effects on the labour market partecipation.minimum income; policy evaluation; poverty trap