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Home production technology and time allocation: empirics, theory, and implications

  • Lei Fang
  • Guozhong Zhu

We document a set of time use patterns in both time series and cross sections. To explain these facts, we propose and estimate a model of time allocation that emphasizes the role of home production technology. We find it necessary to consider both labor-augmenting technology and total factor productivity in home production. Based on the estimated model, we study the effects of proportional tax and lump-sum transfer on time allocation and labor supply, with the roles of home production technology and wage heterogeneity highlighted.

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Paper provided by Federal Reserve Bank of Atlanta in its series FRB Atlanta Working Paper No. with number 2012-19.

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Date of creation: 2012
Date of revision:
Handle: RePEc:fip:fedawp:2012-19
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  1. Jeremy Greenwood & Guillaume Vandenbroucke, 2005. "Hours Worked: Long-Run Trends," NBER Working Papers 11629, National Bureau of Economic Research, Inc.
  2. Freeman, Richard B & Schettkat, Ronald, 2001. " Marketization of Production and the US-Europe Employment Gap," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 63(0), pages 647-70, Special I.
  3. Chinhui Juhn & Kevin M. Murphy, 1996. "Wage Inequality and Family Labor Supply," NBER Working Papers 5459, National Bureau of Economic Research, Inc.
  4. John Y. Campbell & Sydney Ludvigson, 1998. "Elasticities of Substitution in Real Business Cycle Models with Home Production," NBER Working Papers 6763, National Bureau of Economic Research, Inc.
  5. Kelly Ragan, 2007. "Taxes, Transfers and Time Use: Fiscal Policy in a Model of Household Production," 2007 Meeting Papers 681, Society for Economic Dynamics.
  6. Katz, L.F. & Murphy, K.M., 1991. "Changes in Relative Wages, 1963-1987: Supply and Demand Factors," Harvard Institute of Economic Research Working Papers 1580, Harvard - Institute of Economic Research.
  7. 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, May.
  8. Peter Kuhn & Fernando Lozano, 2008. "The Expanding Workweek? Understanding Trends in Long Work Hours among U.S. Men, 1979-2006," Journal of Labor Economics, University of Chicago Press, vol. 26(2), pages 311-343, 04.
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