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The Collective Model of Household Consumption: A Nonparametric Characterization
Author(s) -
Cherchye Laurens,
De Rock Bram,
Vermeulen Frederic
Publication year - 2007
Publication title -
econometrica
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 16.7
H-Index - 199
eISSN - 1468-0262
pISSN - 0012-9682
DOI - 10.1111/j.1468-0262.2006.00757.x
Subject(s) - nonparametric statistics , consumption (sociology) , economics , econometrics , characterization (materials science) , sociology , social science , materials science , nanotechnology
We provide a nonparametric characterization of a general collective model for household consumption, which includes externalities and public consumption. Next, we establish testable necessary and sufficient conditions for data consistency with collective rationality that only include observed price and quantity information. These conditions have a similar structure as the generalized axiom of revealed preference for the unitary model, which is convenient from a testing point of view. In addition, we derive the minimum number of goods and observations that enable the rejection of collectively rational household behavior.