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Understanding Pareto Inefficient Intrahousehold Allocations

Author

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  • Akresh, Richard

    (University of Illinois at Urbana-Champaign)

Abstract
Udry (1996) uses household survey data and finds that the allocation of resources within households is Pareto inefficient, contradicting the main assumption of most collective models of intrahousehold bargaining. He finds that among plots planted with the same crop in the same year, within a given household, those controlled by women produce lower yields than the men's plots. This paper challenges that finding. Using an alternative nationally representative dataset, I find that only households in regions geographically proximate to those studied by Udry exhibit Pareto inefficient intrahousehold allocations, while the rest of the country reveals no evidence of Pareto inefficiencies. Households in regions experiencing negative rainfall shocks are on average less likely to exhibit Pareto inefficient intrahousehold allocations, and these negative rainfall shocks are correlated with increases in labor resources allocated to the wife’s plots, further confirming that in bad years, households try to avoid losses from Pareto inefficiency.

Suggested Citation

  • Akresh, Richard, 2005. "Understanding Pareto Inefficient Intrahousehold Allocations," IZA Discussion Papers 1858, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp1858
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    intrahousehold allocation; collective household models; Pareto efficiency; Africa;
    All these keywords.

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • J12 - Labor and Demographic Economics - - Demographic Economics - - - Marriage; Marital Dissolution; Family Structure
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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