Three essays on the household: time, money, and future time and money

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Pocock, Mark Lester

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How do time constraints affect household expenditures? How productive are household time expenditures, and how do spouses jointly make decisions over time activities? In this thesis I present three essays on the family, time, and household decision making. In the first essay, I ask: What is the time and goods cost of child? Understanding the substitution between time and market goods is increasingly important as incomes increase and available time does not. In this study, I estimate household demands for time and market goods used in caring for children. To construct a data set with time and market goods, I map information from the American Time Use Survey and the Current Population Survey into the Consumer Expenditure Interview Survey for single women and single women with one or two children. I also construct inter-area price indexes to obtain sufficient price variation for estimation. With these price measures and proxies for the value of single parent's time, I estimate household commodity input demands and the cost of a child, holding utility constant. I also report price, cross-price, and income elasticities for time and goods inputs into child care. In the second essay, I ask: What is the return to volunteering? A household's choice to donate time depends on the productivity of volunteering, yet measuring the productivity of volunteering is elusive because the productivity of volunteers is difficult to quantify. I use differences in student's test scores as a proxy for the productivity of classroom parent volunteers. After correcting for biases due to the endogeneity of volunteers, I found that volunteers increase their child's first grade reading test scores by 12 percent. In addition, teachers assign volunteer parent's children higher grades than non-volunteer parent's children. The final essay attempts to understand how couples make decisions. This is a joint work with my colleague, Jungmin Lee. Using individual bank account data from South Korea, where joint accounts are rare and the legal system emphasizes the individuality of financial transactions, we examine the distribution of financial resources between spouses within households. We find that each member's share of household savings depends on the balance of bargaining power. We also found that an increase in a wife's bargaining power increases total household savings. These findings deviate from the traditional unitary model of the household.