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COVID-19’s Impact on U.S. Home Production
The large drop in weekly work hours during the pandemic led to increased time spent on activities like cooking and child care.
Working Paper
Home Production and Leisure During the COVID-19 Recession
Between the months of February and April of 2020, average weekly market hours dropped by 6.25, meanwhile 35% of commuting 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 2.1 hours a week, or 34% of lost market hours, whereas leisure activity increased by 3.8 hours a week. The monthly value of home production increased by $30.83 billion – that is 10.5% of the concurrent $292.61 billion drop in monthly GDP. ...
Discussion Paper
Marketization of Home Production and Gender Gaps in Working Hours
Gender gaps in working hours vary widely across member countries of the Organisation for Economic Co-operation and Development. This article summarizes the key results from Duval-Hernández, Fang, and Ngai (2021), who study the source of cross-country differences and what kind of policies can reduce the gap in working hours between women and men.
Working Paper
Consumption and Hours in the United States and Europe
We document large differences between the United States and Europe in allocations of expenditures and time for both market and home activities. Using a life-cycle model with home production and endogenous retirement, we find that the cross-country differences in consumption tax, social security system, income tax and TFP together can account for 68-95 percent of the cross-country variations and more than half of the average differences between Europe and the United States in aggregate hours and expenditures. These factors can also account well for the cross-country differences in allocations ...
Working Paper
Taxes, Subsidies, and Gender Gaps in Hours and Wages
Using micro data from 17 countries in the Organisation for Economic Co-operation and Development, this paper documents a negative cross-country correlation between gender ratios in market hours and wages. We find that market hours by women and the size of the service sector that produces close substitutes to home production are important for the gender differences in market hours across countries. We quantify the role played by taxes and subsidies to family care on the two gender ratios in a multisector model with home production. Higher taxes and lower subsidies reduce the marketization of ...
Working Paper
Time Use and the Efficiency of Heterogeneous Markups
What are the welfare implications of markup heterogeneity across firms? In standard monopolistic competition models, such heterogeneity implies inefficiency even in the presence of free entry. We enrich the standard model with heterogeneous firms so that preferences are non-separable in off-market time and market consumption and show that this changes the welfare implications of markup heterogeneity. In this context, homogeneity of markups is neither necessary nor sufficient for efficiency. The marginal cost of the marginal firm is weakly inefficiently high when off-market time and market ...
Working Paper
Taxes and Market Hours: The Role of Gender and Skill
Cross-country differences of market hours in 17 countries belonging to the Organisation for Economic Co-operation and Development are mainly due to the hours of women, especially low-skilled women. This paper develops a model to account for the gender-skill differences in market hours across countries. The model explains a substantial fraction of the differences in hours by taxes, which reduce market hours in favor of leisure and home production, and by subsidized care, which frees (mostly) women from home care in favor of their market hours. Low-skilled women are more responsive to policy ...
Working Paper
Consumption and Hours between the United States and France
We document large differences between the United States and France in allocations of consumption expenditures and time by age. Using a life-cycle model, we quantify to what extent tax and transfer programs and market and home productivity can account for the differences. We find that while labor efficiency by age and home-production productivity are crucial in accounting for the differences in the allocation of time, the consumption tax and social security are more important regarding allocation of expenditures. Adopting the U.S. consumption tax decreases welfare in France, and adopting the ...
The Household Shift from Paid Work to Home Production
When U.S. workers lose their jobs or have reduced work hours, how does this affect time spent on activities like cooking and child care?