Autonomy-induced preference, budget reallocation, and child health

Using traditional health capital model of Grossman (The human capital model of the demand for health. NBER, Working Paper 7078, 1972) and Wagstaff (Bull Econ Res 38(1):93–95,1986a) this paper attempts to fill in the theoretical missing link between mothers’ autonomy and household consumption behavior. We focus specifically on the consumption of child health inputs. In our paper it has been shown that working mothers’ children should be of better health. Further, independent of working status of the mother, higher autonomy always reallocates family budget to induce more consumption of child health inputs. The basic results of our model are further reinforced when autonomy is dependent on mothers’ income. In fact, the income effect derived from our extended model indicates that income-induced autonomy may result in redefining the composite consumption good for the family as an inferior one. © 2018, Eurasia Business and Economics Society.