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Unemployment, Market Work and Household Production

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  • Michael Burda
  • Daniel S. Hamermesh

Abstract

Using time-diary data from four countries we show that the unemployed spend most of the time not working for pay in additional leisure and personal maintenance, not in increased household production. There is no relation between unemployment duration and the split of time between household production and leisure. U.S. data for 2003-2006 show that almost none of the lower amount of market work in areas of long-term high unemployment is offset by additional household production. In contrast, in those areas where unemployment has risen cyclically reduced market work is made up almost entirely by additional time spent in household production.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 14676.

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Date of creation: Jan 2009
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Publication status: published as Burda, Michael and Daniel S. Hamermesh. "Unemployment, Market Work and Household Production," Economics Letters, Vol. 107, May 2010, pp. 131-133.
Handle: RePEc:nbr:nberwo:14676

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  1. Mark Aguiar & Erik Hurst, 2006. "Measuring Trends in Leisure: The Allocation of Time Over Five Decades," NBER Working Papers 12082, National Bureau of Economic Research, Inc.
  2. Rupert, Peter & Rogerson, Richard & Wright, Randall, 2000. "Homework in labor economics: Household production and intertemporal substitution," Journal of Monetary Economics, Elsevier, vol. 46(3), pages 557-579, December.
  3. Burda, Michael C. & Hamermesh, Daniel S., 2010. "Unemployment, market work and household production," Economics Letters, Elsevier, vol. 107(2), pages 131-133, May.
  4. Michael C. Burda & Daniel S. Hamermesh, 2009. "Evidence on Unemployment, Market Work and Household Production," SFB 649 Discussion Papers SFB649DP2009-043, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany.
  5. Greenwood, Jeremy & Hercowitz, Zvi, 1991. "The Allocation of Capital and Time over the Business Cycle," Journal of Political Economy, University of Chicago Press, vol. 99(6), pages 1188-214, December.
  6. Reuben Gronau, 2006. "Home Production and the Macro Economy-Some Lessons from Pollak and Wachter and from Transition Russia," NBER Working Papers 12287, National Bureau of Economic Research, Inc.
  7. Lawrence Katz & Bruce Meyer, 1988. "The Impact of the Potential Duration of Unemployment Benefits on the Duration of Unemployment," Working Papers 621, Princeton University, Department of Economics, Industrial Relations Section..
  8. Urban J. Jermann & Marianne Baxter, 1999. "Household Production and the Excess Sensitivity of Consumption to Current Income," American Economic Review, American Economic Association, vol. 89(4), pages 902-920, September.
  9. Daniel S. Hamermesh & Harley Frazis & Jay Stewart, 2005. "Data Watch: The American Time Use Survey," Journal of Economic Perspectives, American Economic Association, vol. 19(1), pages 221-232, Winter.
  10. Hurd, Michael, 1980. "A Compensation Measure of the Cost of Unemployment to the Unemployed," The Quarterly Journal of Economics, MIT Press, vol. 95(2), pages 225-43, September.
  11. Burda, Michael C. & Hamermesh, Daniel S. & Weil, Philippe, 2006. "The Distribution of Total Work in the EU and US," IZA Discussion Papers 2270, Institute for the Study of Labor (IZA).
  12. Richard B. Freeman & Ronald Schettkat, 2005. "Marketization of household production and the EU-US gap in work," Economic Policy, CEPR & CES & MSH, vol. 20(41), pages 6-50, 01.
  13. Benhabib, Jess & Rogerson, Richard & Wright, Randall, 1991. "Homework in Macroeconomics: Household Production and Aggregate Fluctuations," Journal of Political Economy, University of Chicago Press, vol. 99(6), pages 1166-87, December.
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