IZA DP No. 3929: Child Welfare and Old-Age Security in Female Headed Households in Tanzania
This paper is concerned with patterns of expenditure and child welfare among female headed (FHH) and male headed households (MHH) in Tanzania as well as with the underlying cause of potentially different patterns. I estimate semiparametric Engel curves to investigate household expenditure patterns while controlling for household characteristics and find that FHH spend significantly more money on the welfare of children and less on consumption of adult goods. In an attempt to explain this observed difference, I further investigate the empirical content of the old-age security hypothesis, which states that persons lacking the financial means to rely on themselves during old-age invest more in children who care for them in later periods. The results lend support to the idea that old-age security might be the driving force behind the observed differences of expenditure allocated towards the welfare of children. FHH having access to alternative means of old-age security, spend significantly less on child welfare. Furthermore, food expenditure levels of FHH and MHH with access to alternative old-age security become the same.