Intra-Household Welfare Inequality and Household Public Goods
We develop a money metric welfare index for individuals within households, allowing for public goods, work, and heterogeneous preferences for men and women. Using Japanese data, we estimate a collective model of labor supply, private consumption, and expenditures on children and other public goods. We find that women have stronger preference for spending on children and other public goods than men. Within-household inequality is larger than between-household inequality, but has been declining across cohorts, reflecting improvements in women’s position. This is driven by the increase in women’ college graduation, improvement in their relative wages, and the increase in childcare availability.
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