The Sectoral Labor Supply of Married Couples in Brazil: Testing the Unitary Model of Household Behavior

An assumption of the unitary model of household decision-making is that household members maximize one household utility function. This assumption implies that households pool their income and, therefore, the ownership of nonwage income has no effect on household demand. In this paper, this implicat...

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Bibliographic Details
Published in:Journal of population economics 1999-11, Vol.12 (4), p.591-606
Main Author: Tiefenthaler, Jill
Format: Article
Language:English
Subjects:
Bargaining
Brazil
Consumption
Couples
Decision making
Household economics
Household utilities
Households
Income
Informal sector
Labor markets
Labor supply
Labour supply
Men
Nonwage income
Self employment
Utility functions
Wages
Women
Working women
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Summary:An assumption of the unitary model of household decision-making is that household members maximize one household utility function. This assumption implies that households pool their income and, therefore, the ownership of nonwage income has no effect on household demand. In this paper, this implication is tested by estimating multi-sector labor supply equations for men and women in Brazil. The results indicate that the unitary model is rejected in the informal and self-employment sectors for men and the formal and informal sectors for women; in these cases own nonwage income has a significantly negative effect on labor supply while spousal nonwage income has no significant effect.
ISSN:0933-1433
1432-1475
DOI:10.1007/s001480050115