Journal of Political Economy Vol. 90 No. 1 1982
Inequality Within and Between Families
Abstract
Between-family differences in expenditures and output reflect the effect of simultaneous increases in children's ability on the willingness of parents to transfer resources to them. Within-family differences also reflect the attitudes of parents toward disparity among children. In this paper we characterize the conditions on parents' preferences that determine whether between-family differences exceed within-family differences. For additive utility, within-family differences in expenditures always exceed between-family differences. This may also be true for the max-min utility function if an increase in ability reduces the marginal utility of income. Within-family differences in output (utility or income) can also exceed between-family differences. In this case, the implication for income distribution is that equality is enhanced by a higher correlation of ability between brothers.
- DOI
- 10.1086/261041
- Volume
- 90
- Issue
- 1
- Pages
- 105-127
- Language
- en
- Sources
- openalex crossref