Household Expenditure Patterns and Gender Bias: Evidence from Selected Indian States

Abstract

This paper uses Indian data to investigate the existence and nature of gender bias in the intra-household allocation of expenditure. An extended version of the collective household model is estimated where the welfare weights, i.e. the bargaining power of the adult decision-makers, are simultaneously determined with the household's expenditure outcomes. Significant gender bias is detected in some items, most notably in education, and it is found that the bias is considerably stronger in the more economically backward regions of the country. It is also found that the results of the test of gender bias vary sharply between households at different levels of adult literacy. This is particularly true of household spending on education. The gender bias in the case of this item is, generally, more likely to prevail in households with low levels of adult educational attainment than in more literate households. This result is of considerable policy importance given the strong role that education plays in human capital formation.