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Time Use and Macroeconomic Uncertainty

Author

Listed:
  • Matteo Cacciatore
  • Daniela Hauser
  • Stefano Gnocchi

Abstract

We study the effects of uncertainty on time use and their macroeconomic implications. Employing data from the American Time Use Survey and the Bureau of Labor Statistics, we document that heightened uncertainty increases housework and reduces market work hours, mildly impacting leisure. We then propose a model that quantitatively accounts for these estimates. We show that substitution between market and housework provides self-insurance to households, weakening precautionary savings. However, it also reduces aggregate demand, ultimately amplifying uncertainty's recessionary impact. Time reallocation can lead to higher inflation, particularly when uncertainty couples with policies redirecting time use towards housework (e.g., lockdown restrictions).

Suggested Citation

  • Matteo Cacciatore & Daniela Hauser & Stefano Gnocchi, 2023. "Time Use and Macroeconomic Uncertainty," NBER Working Papers 31954, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:31954
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    More about this item

    JEL classification:

    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand

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