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Home Production and Leisure during the COVID-19 Recession

Author

Listed:
  • Leukhina Oksana

    (Research Department, Federal Reserve Bank of St Louis, St Louis, MO, USA)

  • Yu Zhixiu

    (Department of Economics, University of Minnesota, Minneapolis, MN, USA)

Abstract

Between the months of February and April of 2020, average weekly market hours in the U.S. dropped by 6.25, meanwhile 36% of workers reported switching to remote work arrangements. In this paper, we examine implications of these changes for the time allocation of different households, and on aggregate. We estimate that home production activity increased by 2.65 h a week, or 42.4% of lost market hours, due to the drop in market work and rise in remote work. The monthly value of home production increased by $39.65 billion – that is 13.55% of the concurrent $292.61 billion drop in monthly GDP. Although market hours declined the most for single, less educated individuals, the lost market hours were absorbed into home production the most by married individuals with children. Adding on the impact of school closures, our estimate of weekly home production hours increases by as much as 4.92 h. The increase in the value of monthly home production between February and April updates to $73.57 billion. We also report the estimated impact of labor markets and telecommuting on home production for each month in 2020.

Suggested Citation

  • Leukhina Oksana & Yu Zhixiu, 2022. "Home Production and Leisure during the COVID-19 Recession," The B.E. Journal of Macroeconomics, De Gruyter, vol. 22(1), pages 269-306, January.
    • Handle: RePEc:bpj:bejmac:v:22:y:2022:i:1:p:269-306:n:10
    DOI: 10.1515/bejm-2020-0271
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    References listed on IDEAS

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    Cited by:

    1. Matteo Cacciatore & Stefano Gnocchi & Daniela Hauser, 2023. "Time Use and Macroeconomic Uncertainty," Staff Working Papers 23-29, Bank of Canada.
    2. You, Wen & Davis, George C. & Yang, Jinyang, 2022. "Viewpoint: An assessment of recent SNAP benefit increases allowing for money and time variability," Food Policy, Elsevier, vol. 106(C).
    3. Kikuchi, Shinnosuke & Kitao, Sagiri & Mikoshiba, Minamo, 2021. "Who suffers from the COVID-19 shocks? Labor market heterogeneity and welfare consequences in Japan," Journal of the Japanese and International Economies, Elsevier, vol. 59(C).
    4. Makoto Nirei & Nao Sudo, 2020. "Necessities, Home Production, and Economic Impacts of Stay-at-Home Policies," IMES Discussion Paper Series 20-E-14, Institute for Monetary and Economic Studies, Bank of Japan.

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    More about this item

    Keywords

    shutdown; COVID-19; pandemic; home production; remote work;
    All these keywords.

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • 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

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