Expenditure decisions of divorced mothers and income composition

In this paper we analyze the relationship between the income sources of custodial divorced parents and their expenditure patterns. We use data from the Consumer Expenditure Survey to directly investigate the issue or whether or not divorced mothers receiving child support income spend larger amounts on "child goods' than those not receiving child support holding total household income constant. By comparing the estimated coefficients on child support income and other income in an "endogenous' Engel curve specification we argue that we can classify child goods as being public or private and say something about the expenditure patterns of noncustodial fathers under a Nash equilibrium model of parental expenditures on public child goods and some plausible assumptions regarding the manner in which child support transfer decisions are made by noncustodial fathers. -from Authors