Is Power More Evenly Balanced in Poor Households?

Abstract

The structure of intra-household allocation is crucial to know whether a transfer from a rich household to a poor one translates into a transfer from a rich individual to a poor one. If rich households are more unequal than poor ones, then a progressive transfer among households reduces intra-household inequality, hence inequality among individuals. More specifically, two conditions have to be satisfied for extending Generalized Lorenz judgments from household level to individual one. The fraction of the coupleís expenditures devoted to goods jointly consumed should decrease at the margin with the coupleís income as well as the part of private expenditure devoted to the disadvantaged individual. This double concavity condition is non-parametrically tested on the French Household Expenditure Survey (2000). It is not rejected by the data and support the view that power is more evenly distributed in poor households.

Keywords: Lorenz comparisons, intra-household inequality, sharing functions, non-parametric concavity test

JEL Classification: D63, D13, C14