Uncovering hidden household inequality with grant recipient Valérie Lechene
We caught up with Stone Centre internal grant recipient Valérie Lechene, a Professor of Economics at UCL, to hear about her work on how money and time are really shared within households. Her Stone Centre-funded project extends her UK findings on gender and household resource shares to the US.
Please tell us a bit about your academic background.
I did all my formal training in France: a Magistère de Sciences Économiques (a joint programme of Université Paris I Panthéon-Sorbonne, EHESS and the École Normale Supérieure), followed by a Diplôme d'Études Approfondies (DEA) and then a PhD in Economics, both from EHESS in Paris. After my PhD, I was a research fellow at INRA (the French National Institute for Agricultural Research) in Paris. In 1997 I visited UCL as a Marie Curie Fellow, before moving to Oxford, where I was a University Lecturer and Fellow of Wadham College. I then moved back to UCL in 2007, initially as an ESRC Research Fellow, and I am now a Professor in the Department of Economics. I am also a Research Fellow at the Institute for Fiscal Studies (IFS) and a Research Fellow of the Centre for Economic Policy Research (CEPR).
Throughout, I have worked as an applied microeconomist interested in the behaviour of individuals, theoretically and empirically, with a particular focus on intrahousehold behaviour, gender, and the economics of the family.
What is your research about?
My research is about how resources, both money and time, are shared between the people who live in the same household. Standard measures of poverty and inequality assume that a household's income or spending is shared equally between its members; if that assumption is wrong, we can over- or under-estimate poverty and inequality. With my co-authors Krishna Pendakur and Alex Wolf, I developed new statistical tools that use ordinary household budget survey data (no special surveys required) to work out how much of a household's spending actually goes to each person inside it.
Most recently, working with Richard Blundell, Heidi Karjalainen and Krishna Pendakur, we used these tools on 40 years of UK data (1978–2019) and found that the share of household expenditure going to women rose from well below parity (around 35%) to near parity over that period, and that this shift offset some of the well-documented rise in inequality across households during the 1980s and 1990s.
The project funded by the Stone Centre grant takes this in a new direction. First, my co-authors Arthur Lewbel, Krishna Pendakur and I will replicate the analysis for the US, using the Consumer Expenditure Survey, to see whether the same pattern holds there. Second, and this is the more novel part, we want to understand a puzzle: if women's share of household resources has been rising, why don't women seem to be doing better overall? One explanation, suggested by recent work by Kyle Hancock, Jeanne Lafortune and Corinne Low, is that American women have taken on more paid work without reducing their hours of unpaid domestic work. Perhaps men are compensating them for this lost leisure time with a larger share of household spending. We are building a structural model, combining US time-use data (from the American Time Use Survey) with expenditure data (from the CEX), to test whether there is a genuine trade-off between women's time and their share of household resources.
Why did you decide to study this topic?
Standard measures of poverty and inequality treat the household as a single unit, which assumes that everyone inside it (men, women, children) shares equally in its resources. This is a strong assumption, and in many cases clearly wrong, which means we may be missing a whole layer of inequality that happens inside rather than between households. I have spent much of my career developing tools that let us test that assumption rather than take it for granted, and gender has always been at the centre of this: understanding whether women and men really do share equally in household resources feels essential to understanding inequality properly.
This particular project grew directly out of our finding that UK women's resource shares have risen substantially since the 1970s, a genuinely good-news result, but it immediately raised an uncomfortable question: why hasn't this obviously translated into better outcomes for women overall? That puzzle, and the chance to test a real economic mechanism, a possible time-for-money trade-off, behind it, is what pulled us towards this project.
How does your research contribute to the Stone Centre's mission of developing our knowledge of inequality?
The Stone Centre's mission is to build a clearer understanding of the causes and consequences of economic inequality. Almost all of that work, including most standard measures of poverty and inequality, is built on the assumption that resources are shared equally within households. If that assumption is wrong, as I believe it often is, we are missing a real and important source of inequality: the inequality that exists within households, not just between them.
My research provides some of the tools needed to relax that assumption and measure within-household inequality directly, using data that is already collected in household surveys in many countries. Part of the wider agenda behind this work is also to encourage national statistical agencies to collect more of the kind of person-specific spending data (on clothing, and ideally other goods, such as food) that make this kind of analysis possible more widely. In short, I hope this research helps make sure that when we talk about "inequality", we mean the inequality people actually experience, including inequality between the individuals who share a household, rather than a version of inequality that is easier to measure but incomplete.
How will the Stone Centre grant help you?
The grant lets us extend a UK research programme to the US, which requires a substantial amount of new data work: extracting and harmonising variables from two large US surveys (the CEX and the ATUS) that don't cover the same households. Part of the funding supports a research assistant, which lets us do that data work properly and, just as importantly, gives me the chance to train someone in the empirical methods we use for this kind of research.
It will also let me travel to Vancouver to work in person with my long-standing co-author Krishna Pendakur. Beyond the practicalities, being a Stone Centre grantee also means the Centre's help in publicising the work, which matters a great deal for a project whose ultimate goal is to change how people think about and measure inequality.
What will you produce as part of your research?
Over the course of the grant, we plan to produce a working paper reporting our findings on resource shares, time use and inequality in the US; a set of lecture notes on the sharing of time and expenditure within households, which we hope can also feed into CORE Econ teaching materials; and slides for presenting the work at conferences and seminars.
Useful links
Valérie's personal website: www.valerielechene.com
Valérie's IFS profile: ifs.org.uk/people/valerie-lechene
Authors
Stone Centre at UCL
Stone Centre at UCL.