Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/25559
Authors: 
Koulovatianos, Christos
Schröder, Carsten
Schmidt, Ulrich
Year of Publication: 
2008
Series/Report no.: 
CFS Working Paper 2008/24
Abstract: 
Modern macroeconomics empirically addresses economy-wide incentives behind economic actions by using insights from the way a single representative household would behave. This analytical approach requires that incentives of the poor and the rich are strictly aligned. In empirical analysis a challenging complication is that consumer and income data are typically available at the household level, and individuals living in multimember households have the potential to share goods within the household. The analytical approach of modern macroeconomics would require that intra-household sharing is also strictly aligned across the rich and the poor. Here we have designed a survey method that allows the testing of this stringent property of intra-household sharing and find that it holds: once expenditures for basic needs are subtracted from disposable household income, household-size economies implied by the remainder household incomes are the same for the rich and the poor.
Subjects: 
Linear Aggregation
Representative Consumer
Equivalence Scales
Survey Method
Household-Size Economies
JEL: 
C42
E21
D12
E01
D11
D91
D31
I32
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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