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The Demand for Variety: A Household Production Perspective

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Author Info
Daniel Hamermesh () (University of Texas at Austin, NBER and IZA)
Reuben Gronau () (Hebrew University, Jerusalem)

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Abstract

Economists have devoted substantial attention to firms’ supply of variety, but little to consumers’ demand for variety. Employing the framework of home production, we trace differences in demand to differences in the opportunity costs of activities, which are associated with investments in human capital. Schooling alters time costs and changes the variety of activities household members choose. In time budgets from Australia, Israel, and West Germany we find that higher own and spouses’ incomes raise variety (suggesting positive income effects). Education increases variety independent of income and earnings; part of its impact goes beyond a correlation of educational attainment with preferences for variety.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 2767.

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Length: 33 pages
Date of creation: Apr 2007
Date of revision:
Handle: RePEc:iza:izadps:dp2767

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Related research
Keywords: time use; education; gender;

Other versions of this item:

Find related papers by JEL classification:
D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

This paper has been announced in the following NEP Reports:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Romer, Paul M, 1986. "Increasing Returns and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 94(5), pages 1002-37, October. [Downloadable!] (restricted)
  2. Hamermesh, Daniel S., 2000. "Timing, Togetherness and Time Windfalls," IZA Discussion Papers 173, Institute for the Study of Labor (IZA).
    Other versions:
  3. Daniel S Hamermesh & Jungmin Lee, 2007. "Stressed Out on Four Continents: Time Crunch or Yuppie Kvetch?," The Review of Economics and Statistics, MIT Press, vol. 89(2), pages 374-383, 03. [Downloadable!] (restricted)
    Other versions:
  4. Michael, Robert T, 1973. "Education in Nonmarket Production," Journal of Political Economy, University of Chicago Press, vol. 81(2), pages 306-27, Part I, M. [Downloadable!] (restricted)
  5. Dan Devroye & Richard B. Freeman, 2001. "Does Inequality in Skills Explain Inequality in Earnings Across Advanced Countries?," NBER Working Papers 8140, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  6. Bound, John, et al, 1994. "Evidence on the Validity of Cross-Sectional and Longitudinal Labor Market Data," Journal of Labor Economics, University of Chicago Press, vol. 12(3), pages 345-68, July. [Downloadable!] (restricted)
  7. Reuben Gronau & R. Layard, . "Home Production - A Survey," University of Chicago - Population Research Center 85-2, Chicago - Population Research Center.
  8. Grogger, Jeff, 1998. "Market Wages and Youth Crime," Journal of Labor Economics, University of Chicago Press, vol. 16(4), pages 756-91, October. [Downloadable!] (restricted)
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  9. Kooreman, Peter & Kapteyn, Arie, 1987. "A Disaggregated Analysis of the Allocation of Time within the Household," Journal of Political Economy, University of Chicago Press, vol. 95(2), pages 223-49, April. [Downloadable!] (restricted)
  10. Salop, Steven, 1977. "The Noisy Monopolist: Imperfect Information, Price Dispersion and Price Discrimination," Review of Economic Studies, Blackwell Publishing, vol. 44(3), pages 393-406, October. [Downloadable!] (restricted)
  11. Jackson, Laurence Fraser, 1984. "Hierarchic Demand and the Engel Curve for Variety," The Review of Economics and Statistics, MIT Press, vol. 66(1), pages 8-15, February. [Downloadable!] (restricted)
  12. Dixit, Avinash K & Stiglitz, Joseph E, 1977. "Monopolistic Competition and Optimum Product Diversity," American Economic Review, American Economic Association, vol. 67(3), pages 297-308, June. [Downloadable!] (restricted)
    Other versions:
  13. Timothy F. Bresnahan & Robert J. Gordon, 1996. "The Economics of New Goods," NBER Books, National Bureau of Economic Research, Inc, number bres96-1.
  14. Biddle, Jeff E & Hamermesh, Daniel S, 1990. "Sleep and the Allocation of Time," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 922-43, October. [Downloadable!] (restricted)
    Other versions:
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Daniel S. Hamermesh, 2003. "Routine," NBER Working Papers 9440, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  2. Hallberg, Daniel, 2002. "Synchronous Leisure, Jointness and Household Labor Supply," Working Paper Series 2002:11, Uppsala University, Department of Economics. [Downloadable!]
    Other versions:
  3. Victoria Vernon, 2004. "Food Expenditure, Food Preparation Time and Household Economies of Scale," Labor and Demography 0412005, EconWPA. [Downloadable!]
  4. Drescher, Larissa & Thiele, Silke & Weiss, Christoph, 2006. "The Taste for Variety: A Hedonic Analysis," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25251, International Association of Agricultural Economists. [Downloadable!]
  5. Daniel S. Hamermesh & Jungmin Lee, 2003. "Stressed Out on Four Continents: Time Crunch or Yuppie Kvetch?," NBER Working Papers 10186, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
  6. Christos Koulovatianos & Carsten Schröder & Ulrich Schmidt, 2005. "Non-Market Time and Household Well-Being," Vienna Economics Papers 0507, University of Vienna, Department of Economics. [Downloadable!]
    Other versions:
  7. Daniel S. Hamermesh, 2005. "Why Not Retire? The Time and Timing Costs of Market Work," Working Papers wp104, University of Michigan, Michigan Retirement Research Center. [Downloadable!]
  8. Jorge Gonzalez-Chapela, 2005. "On Measuring Convergence in the Use of Time," MEA discussion paper series 05096, Mannheim Research Institute for the Economics of Aging (MEA), University of Mannheim. [Downloadable!]
  9. Daniel S. Hamermesh, 2006. "The Time and Timing Costs of Market Work, and their Implications for Retirement," IZA Discussion Papers 2030, Institute for the Study of Labor (IZA). [Downloadable!]
  10. Trevon D. Logan, 2008. "Economies of Scale in the Household: Puzzles and Patterns from the American Past," NBER Working Papers 13869, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  11. Christos Koulovatianos & Carsten Schröder & Ulrich Schmidt, 2006. "Non-Market Household Time and the cost of Children," Vienna Economics Papers 0606, University of Vienna, Department of Economics. [Downloadable!]
    Other versions:
  12. Mette Gørtz, 2006. "Heterogeneity in Preferences and Productivity – Implications for Retirement," CAM Working Papers 2006-01, University of Copenhagen. Department of Economics. Centre for Applied Microeconometrics. [Downloadable!]
  13. Bonke, Jens & Gupta, Nabanita Datta & Smith, Nina, 2003. "Timing and Flexibility of Housework and Men and Women's Wages," IZA Discussion Papers 860, Institute for the Study of Labor (IZA). [Downloadable!]
  14. Daniel S. Hamermesh, 2009. "Grazing, Goods and Girth: Determinants and Effects," NBER Working Papers 15277, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  15. Anne Solaz, 2005. "Division of Domestic Work: Is There Adjustment Between Partners when One is Unemployed?," Review of Economics of the Household, Springer, vol. 3(4), pages 387-413, December. [Downloadable!] (restricted)
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