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Periodical article Periodical article Leiden University catalogue Leiden University catalogue WorldCat catalogue WorldCat
Title:Intra-household efficiency: an experimental study from Ethiopia
Authors:Kebede, BereketISNI
Tarazona, Marcela
Munro, AlistairISNI
Verschoor, ArjanISNI
Year:2014
Periodical:Journal of African Economies (ISSN 0963-8024)
Volume:23
Issue:1
Pages:105-150
Language:English
Geographic term:Ethiopia
Subjects:households
household budget
efficiency
economic models
External link:https://doi.org/10.1093/jae/ejt019
Abstract:A common feature of many intra-household models is the assumption of efficiency in resource allocation ('income pooling'). This paper uses an experimental design to directly test this. Data from 1,200 married couples in Ethiopia were collected in 2009 using treatments that vary initial endowments of spouses, final allocation rules and information in a voluntary contribution mechanism (VCM). Efficiency is decisively rejected in all treatments. Information improves efficiency only in some treatments, suggesting that the role of information is context dependent. Husbands' expectations of their wives' contributions are higher than their wives' actual contributions, and wives' expectations of their husbands' contributions are lower than their husbands' actual contributions. These systematic errors in expected and actual behaviour imply that the attainment of equilibrium as in a game theoretic framework is unlikely. Statistical tests indicate that instead of efficiency, other considerations are likely important. Overall, most of the empirical results cast doubt on models of the household that assume Pareto efficiency. App., bibliogr., notes, ref., sum. [Journal abstract]
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