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Do Time Poor Individuals Pay More?

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  • Tim Rathjen

    ()
    (LEUPHANA University Lüneburg,Department of Economic, Behaviour and Law Sciences, Research Institute on Professions (Forschungsinstitut Freie Berufe (FFB)))

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    Abstract

    There is a rising number of concepts that try to describe the broad perception of time poverty. Though detailed time poverty analyses are available, still little is said about its impacts on the individual behaviour. Within this article, a possible new implication is analysed: The author tests whether time poor individuals compare less between prices as a result of their time deficit, therefore do not identify “bargains or rip-offs” and pay on average more for identical products and services than not time poor individuals. Using data drawn from the German Time Use Survey (GTUS) 2001/02, time use information is imputed into the German Sample Survey of Income and Expenditure (IES) 2003 to identify time poor individuals in the IES 2003. Instrumental variables estimations are arranged to account for an expected bias in ordinary least squares estimations – caused by the excluded variable (search) ability – and to catch the causal effect of time poverty on paid prices. The results do not confirm a higher price paid by time poor individuals. The findings rather suggest that time poor persons find trust in stores with a fair price performance ratio, remain loyal to them and accordingly pay a similar amount for goods and services than not time poor individuals in most cases.

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    File URL: http://www.leuphana.de/fileadmin/user_upload/Forschungseinrichtungen/ffb/files/publikationen/diskussion/DP_91_-_Do_Time_Poor_Individuals_Pay_More.pdf
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    Bibliographic Info

    Paper provided by Research Institute on Professions (Forschungsinstitut Freie Berufe (FFB)), LEUPHANA University Lüneburg in its series FFB-Discussionpaper with number 91.

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    Length: 29 pages
    Date of creation: Oct 2011
    Date of revision:
    Handle: RePEc:leu:wpaper:91

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    Web page: http://ffb.uni-lueneburg.de/repec/leu/
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    Related research

    Keywords: Time poverty; Time use and well-being; Price dispersion; Price Search; Asymmetric Information;

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    References

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    1. George J. Stigler, 1961. "The Economics of Information," Journal of Political Economy, University of Chicago Press, vol. 69, pages 213.
    2. Joachim Merz & Tim Rathjen, 2011. "Intensity of Time and Income Interdependent Multidimensional Poverty: Well-Being and Minimum 2DGAP ; German Evidence," SOEPpapers on Multidisciplinary Panel Data Research 411, DIW Berlin, The German Socio-Economic Panel (SOEP).
    3. Steven Salop & Joseph Stiglitz, 1977. "Bargains and ripoffs: a model of monopolistically competitive price dispersion," Special Studies Papers 94, Board of Governors of the Federal Reserve System (U.S.).
    4. Quentin Wodon & Elena Bardasi, 2006. "Measuring Time Poverty and Analyzing its Determinants: Concepts and Application to Guinea," Economics Bulletin, AccessEcon, vol. 10(12), pages 1-7.
    5. Mark Aguiar & Erik Hurst, 2005. "Consumption versus Expenditure," Journal of Political Economy, University of Chicago Press, vol. 113(5), pages 919-948, October.
    6. Merz, Joachim & Rathjen, Tim, 2009. "Time and Income Poverty: An Interdependent Multidimensional Poverty Approach with German Time Use Diary Data," IZA Discussion Papers 4337, Institute for the Study of Labor (IZA).
    7. Joachim Merz & Dominik Hanglberger & Rafael Rucha, 2010. "The Timing of Daily Demand for Goods and Services—Microsimulation Policy Results of an Aging Society, Increasing Labour Market Flexibility, and Extended Public Childcare in Germany," Journal of Consumer Policy, Springer, vol. 33(2), pages 119-141, June.
    8. Andrew Harvey & Arun Mukhopadhyay, 2007. "When Twenty-Four Hours is not Enough: Time Poverty of Working Parents," Social Indicators Research, Springer, vol. 82(1), pages 57-77, May.
    9. Michael R. Baye & John Morgan, 2001. "Information Gatekeepers on the Internet and the Competitiveness of Homogeneous Product Markets," American Economic Review, American Economic Association, vol. 91(3), pages 454-474, June.
    10. repec:ebl:ecbull:v:10:y:2006:i:12:p:1-7 is not listed on IDEAS
    11. Pratt, John W & Wise, David A & Zeckhauser, Richard, 1979. "Price Differences in Almost Competitive Markets," The Quarterly Journal of Economics, MIT Press, vol. 93(2), pages 189-211, May.
    12. Joachim Merz & Tim Rathjen, 2010. "Sind Selbständige zeit- und einkommensarm? Eine Mikroanalyse der Dynamik interdependenter multidimensionaler Armut mit dem Sozio-ökonomischen Panel und den deutschen Zeitbudgeterhebungen," FFB-Discussionpaper 82, Research Institute on Professions (Forschungsinstitut Freie Berufe (FFB)), LEUPHANA University Lüneburg.
    13. Jonathan Haughton & Shahidur R. Khandker, 2009. "Handbook on Poverty and Inequality," World Bank Publications, The World Bank, number 11985, October.
    14. Jens Bonke & Frederik Gerstoft, 2007. "Stress, time use and gender," electronic International Journal of Time Use Research, Research Institute on Professions (Forschungsinstitut Freie Berufe (FFB)) and The International Association for Time Use Research (IATUR), vol. 4(1), pages 47-68, September.
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