Pierre André Chiappori (Columbia) "Family Economics" - Cemmap

224 5. Empirical issues for the collective model
validity of these factors. The most widely used distribution factor for this
is some measure of relative incomes, earnings or wages. Such tests are
often called tests of ‘income pooling’: only household income matters for
choice outcomes and not the source of the income. 10 As we have seen,
Becker explicitly introduced the RKT to justify income pooling. Tests for
the exclusion of other distribution factors constitute a generalization of
income pooling.
Distribution factor
1 Relative income
2 Relative wages
3 Relative unearned income
4 Relative age
5 Relative education
6 Local sex ratio
7 Household income
8 Background family factors
9 Control of land
10 Previous children
11 Reported influence within household
12 Married or cohabiting
13 Divorce laws
14 Alimonies
15 Single parent benefits
16 Gender of a benefit’s recipient
TABLE 5.1. Distribution factors
Bruce (1989) provides a listing of the research on low income countries
documenting tensions within households about the use of household resources.
Strauss et al (2000) present an exhaustive list of tests for income
pooling for low income countries up to their publication date. Table 5.2
lists some of the studies that have considered non-unitary models. 11 As
can be seen from this Table, a wide variety of outcomes and distribution
factors have been considered for many different countries. The most widely
used distribution factor is relative income (the ‘income pooling’ test). All
of the cited papers find a significant role for the distribution factors that
should not affect the outcomes in a unitary model. For instance, an early
and influential paper by Thomas (1990), based on Brazilian cross-sectional
10Income pooling is a necessary condition for a unitary model but not a sufficient
condition. In particular, income pooling can hold locally if we have a noncooperative
voluntary contributions game; see section 4 of chapter 3.
11This listing is by no means exhaustive and tends to focus on results from high income
countries.