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A Simple Identification Strategy for Gary Becker's Time Allocation Model

Author

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  • Cherchye, Laurens

    () (KU Leuven)

  • De Rock, Bram

    () (ECARES, Free University of Brussels)

  • Vermeulen, Frederic

    () (KU Leuven)

Abstract

The implementation of Gary Becker's (1965) time allocation model is hampered by the fact that values of the different time uses are usually not observed. In practice, one often assumes that the value of time is uniform across time uses by using market wages. This approach implies a fundamental identification problem. We demonstrate that the identification problem can be solved if production shifters are available.

Suggested Citation

  • Cherchye, Laurens & De Rock, Bram & Vermeulen, Frederic, 2015. "A Simple Identification Strategy for Gary Becker's Time Allocation Model," IZA Discussion Papers 9001, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp9001
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    References listed on IDEAS

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    1. Flavio Cunha & James J. Heckman & Susanne M. Schennach, 2010. "Estimating the Technology of Cognitive and Noncognitive Skill Formation," Econometrica, Econometric Society, vol. 78(3), pages 883-931, May.
    2. James Heckman & Flavio Cunha, 2007. "The Technology of Skill Formation," American Economic Review, American Economic Association, vol. 97(2), pages 31-47, May.
    3. Laurens Cherchye & Bram De Rock & Frederic Vermeulen, 2012. "Married with Children: A Collective Labor Supply Model with Detailed Time Use and Intrahousehold Expenditure Information," American Economic Review, American Economic Association, vol. 102(7), pages 3377-3405, December.
    4. Arthur Lewbel, 1998. "Semiparametric Latent Variable Model Estimation with Endogenous or Mismeasured Regressors," Econometrica, Econometric Society, vol. 66(1), pages 105-122, January.
    5. Michael, Robert T, 1973. "Education in Nonmarket Production," Journal of Political Economy, University of Chicago Press, vol. 81(2), pages 306-327, Part I, M.
    6. Richard Blundell & Pierre-André Chiappori & Costas Meghir, 2005. "Collective Labor Supply with Children," Journal of Political Economy, University of Chicago Press, vol. 113(6), pages 1277-1306, December.
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    8. Kelvin J. Lancaster, 1966. "A New Approach to Consumer Theory," Journal of Political Economy, University of Chicago Press, vol. 74, pages 132-132.
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    12. Pollak, Robert A & Wachter, Michael L, 1975. "The Relevance of the Household Production Function and Its Implications for the Allocation of Time," Journal of Political Economy, University of Chicago Press, vol. 83(2), pages 255-277, April.
    13. François Bourguignon & Martin Browning & Pierre-André Chiappori, 2009. "Efficient Intra-Household Allocations and Distribution Factors: Implications and Identification," Review of Economic Studies, Oxford University Press, vol. 76(2), pages 503-528.
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    Cited by:

    1. Jara-Díaz, Sergio R. & Astroza, Sebastian & Bhat, Chandra R. & Castro, Marisol, 2016. "Introducing relations between activities and goods consumption in microeconomic time use models," Transportation Research Part B: Methodological, Elsevier, vol. 93(PA), pages 162-180.

    More about this item

    Keywords

    time use; home production; identification; production shifter;

    JEL classification:

    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation

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