The Measurement of Child Costs: A Rothbarth-Type Method Consistent with Scale Economies and Parents? Bargaining

Abstract

We propose a new methodology to estimate the share of household income accruing to children, i.e., the cost of children. The household behavior is represented according to the collective approach. That is, each household member is characterized by speci.c preferences. Following the principle of the Rothbarth approach, the identi.cation of the children.s share requires the observation of adult-speci.c goods. Our method di¤ers from this traditional approach in that it is compatible with economies of scale as well as with parents. bargaining. In addition, it allows de.ning a new concept of child costs that takes into account economies of scale. We illustrate the method with an application on the French Household Budget Survey.Consumer Demand; Collective Model; Rothbarth Method; Cost of Children; Scale Economies; Equivalence Scales; Indifference Scales