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Bundling Time and Goods: Implications for Hours Dispersion

Author

Listed:
  • Lei Fang

    (Federal Reserve Bank of Atlanta)

  • Anne Hannusch

    (Department of Economics, University of Mannheim)

  • Pedro Silos

    (Department of Economics, Temple University)

Abstract

We document the large dispersion in hours worked in the cross-section. We account for this fact using a model in which households combine market inputs and time to produce a set of non-market activities. To estimate the model, we create a novel data set that pairs expenditures and time use for each activity. The estimated model can account for a large fraction of the dispersion in hours worked. The substitutability between market inputs and time within an activity and across a sizable number of activities is key. Models missing these features can only generate one-third of the observed hours dispersion.

Suggested Citation

  • Lei Fang & Anne Hannusch & Pedro Silos, 2020. "Bundling Time and Goods: Implications for Hours Dispersion," DETU Working Papers 2003, Department of Economics, Temple University.
    • Handle: RePEc:tem:wpaper:2003
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    References listed on IDEAS

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    Cited by:

    1. Timo Boppart & L. Rachel Ngai, 2021. "Rising inequality and trends in leisure," Journal of Economic Growth, Springer, vol. 26(2), pages 153-185, June.
    2. William Bednar & Nick Pretnar, 2019. "Home Production with Time to Consume," 2019 Meeting Papers 328, Society for Economic Dynamics.

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    More about this item

    Keywords

    Time Allocation; Consumption Expenditures; Hours Dispersion; Elasticity of Substitution;
    All these keywords.

    JEL classification:

    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory

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