Economic literature suggests adopting the equivalence scale in order to calculate the private monetary cost of a child. This estimation is based upon controversia1 assumptions about exogeneity of fertility choice, identica1preferences and possibility of welfare comparisons. In this paper we pro- pose a different approach for estimating the cost of children. This method does not require household welfare comparisons and assumptions about preferences. Using the 1997 Italian Household Budget survey, we estimate the increase in the total expenditure caused by the presence of an additional child for households with equal income and socio-economic characteristics. The monthly margina1cost is equal to 9% for households with average income.
Il costo dei figli: una stima svincolata dal benessere
POLIN, Veronica
2004-01-01
Abstract
Economic literature suggests adopting the equivalence scale in order to calculate the private monetary cost of a child. This estimation is based upon controversia1 assumptions about exogeneity of fertility choice, identica1preferences and possibility of welfare comparisons. In this paper we pro- pose a different approach for estimating the cost of children. This method does not require household welfare comparisons and assumptions about preferences. Using the 1997 Italian Household Budget survey, we estimate the increase in the total expenditure caused by the presence of an additional child for households with equal income and socio-economic characteristics. The monthly margina1cost is equal to 9% for households with average income.
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