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Project

Intertemporal collective consumption decisions: A revealed preference analysis.

There is a growing consensus that a realistic modeling of household consumption behavior must take into account preference heterogeneity withinthe household. In many cases, the household decision-making process cannot be explained by the restrictive unitary framework, which models the household as if it were a single decision maker. Many studies reject theempirical validity of the unitary model for multi-person household behavior.  In addition, many household decisions are inherently intertemporal. For example, such intertemporal interdependence typically applies to decisions on family savings, investment in human capital, housing purchase, fertility decisions, ... This directly extends to a consumption setting. In many cases, consumption today impacts on consumption tomorrow and vice versa. This PhD project aims at developing a methodology for revealed preference analysis of intertemporal consumption decisions of multiperson households. To account for the intertemporal nature of household decisions, it adopts the life cycle model. Next, to account for the non-unitary nature of household decisions, it adopts the collective model. This model explicitly recognizes that a multi-person household consists of multiple members (decision makers) with their own preferences. The model considers the observed household consumption behavior as the result of a within-household bargaining process between these members.It (only) assumes that this process yields a Pareto efficient within-household allocation. Essentially, this must obtain a methodology that allows for powerful empirical analysis. The projects also aims at demonstrating this potential by meaningful empirical applications.
Date:25 Aug 2009 →  15 Sep 2012
Keywords:Non-parametric setting, Household behaviour
Disciplines:Applied economics, Economic history, Macroeconomics and monetary economics, Microeconomics, Tourism
Project type:PhD project