The Behavioral and Welfare Analysis of Consumption: "The Cost Of Children, Equity And Poverty In Colombia"

The motive force of human activity that propels the stream of progress is here caught at its source, in its most modest, material expressions. The mechanism of the passions acting as determinant in these low spheres is less complex and can therefore be observed with greater precision. All one need do is leave the picture its clear, calm colors and its simple design. Gradually, as that search for material well-being by which man is tormented grows and expand, it also tends to rise and pursue an ascendant course thorough the social classes. In 'I Malavoglia' it is still only the struggle for material needs. Once these needs are satisfied, the search turns into greed for riches and will be embedded in a bourgeois type . . . Giovanni Verga, from the Introduction to The House by the Medlar Tree (I Malavoglia) Motivation In the past decade, many less developed countries have undertaken structural adjustment programs with the hope of breaking the vicious circle of the depression that enveloped them during the 1980s and of loosening the suffocating grip of the debt crisis. Nearly always, macroeconomic stabilization implies a reduction of public spending and, consequently, a reduction of subsidies on wage goods and food production. Other macro policies, such as tariff elimination and exchange rates alignment, alter relative prices and may have significant effects on the level and distribution of income. Today, poverty and inequality are perceived as economic threats as a result of globalization and unbalanced market expansion. The Behavioral and Welfare Analysis of Consumption covers a wide range of applications using modern parametric and nonparametric econometric techniques related to the behavioural and welfare analysis of consumption. The applications measuring the cost of children, equity and poverty in Colombia are based on the theoretical developments presented in literature during the 1990's. The Behavioral and Welfare Analysis of Consumption places special emphasis on the treatment of demographic characteristics and the interpretation of their effects both in demand and welfare analysis related to the estimation of equivalence scales, social welfare functions and micro-simulations of poverty. The Behavioral and Welfare Analysis of Consumption is a comprehensive and up-to-date reference intended for graduate and advanced undergraduate students interested in the applied fields of consumption economics, welfare economics, development economics and applied econometrics. The contents of the book may be of use also to institutions in the implementation of applied welfare policies of both developed and less developed countries and the analysis of household surveys in general Front Matter....Pages i-xxvii Front Matter....Pages 1-1 A Demographically Modified Demand Model: Behavioral and Welfare Properties....Pages 3-39 Demographics and Quality: Household Production Theory and the “Repackaging Model” Revisited....Pages 41-60 Household Equivalence Scales and Interpersonal Comparisons....Pages 61-105 Front Matter....Pages 107-107 Estimation of a Censored Demand System....Pages 109-140 Indexes of Characteristics: Income and Substitution Effects....Pages 141-151 The Cost of Children and the Distribution of Welfare....Pages 153-211 Front Matter....Pages 213-213 Microsimulations of Poverty and Inequality Using the Distribution of Welfare....Pages 215-236 Equity Versus Efficiency in Colombia During the Second Half of the 1980s....Pages 237-259 Conclusions....Pages 261-274 Back Matter....Pages 275-379