Revealed Preference Analysis of Non‐Cooperative Household Consumption

24 Pages Posted: 21 Sep 2011

See all articles by L. Cherchye

L. Cherchye

KU Leuven; Erasmus Research Institute of Management (ERIM)

Thomas Demuynck

Catholic University of Leuven (KUL) - Campus Kortrijk (KULAK) - Subfaculty of Economics and Applied Economics

Bram De Rock

affiliation not provided to SSRN

Date Written: September 2011

Abstract

We develop a revealed preference approach to analyse non‐unitary household consumption behaviour that is not cooperative (or Pareto efficient). We derive global necessary and sufficient conditions for data consistency with the model. We show that the conditions can be verified by means of relatively straightforward mixed integer programming methods, which is particularly attractive in view of empirical analysis. Our framework extends to tests for separate spheres and joint contribution to public goods. An application to data drawn from the Russia Longitudinal Monitoring Survey demonstrates the empirical relevance of the non‐cooperative consumption model.

Suggested Citation

Cherchye, Laurens and Demuynck, Thomas and Rock, Bram De, Revealed Preference Analysis of Non‐Cooperative Household Consumption (September 2011). The Economic Journal, Vol. 121, Issue 555, pp. 1073-1096, 2011, Available at SSRN: https://ssrn.com/abstract=1931356 or http://dx.doi.org/10.1111/j.1468-0297.2011.02432.x

Laurens Cherchye (Contact Author)

KU Leuven ( email )

Oude Markt 13
Leuven, Vlaams-Brabant
Belgium

Erasmus Research Institute of Management (ERIM)

P.O. Box 1738
3000 DR Rotterdam
Netherlands

Thomas Demuynck

Catholic University of Leuven (KUL) - Campus Kortrijk (KULAK) - Subfaculty of Economics and Applied Economics ( email )

Etienne Sabbelaan 53
Kortrijk, B-8500
Belgium

Bram De Rock

affiliation not provided to SSRN

No Address Available

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