Loafing or Learning? The Demand for Informal Education

36 Pages Posted: 16 Sep 2003  

Rene Fahr

University of Paderborn; IZA Institute of Labor Economics

Date Written: August 2003

Abstract

Using detailed time use data for Germany a positive correlation is found between the level of schooling education and time investments in informal education. Two hypotheses explain this observation: (1) highly educated people have higher opportunity costs of their leisure time and thus prefer leisure activities which add to their market productivity (wage effect) and (2)
highly educated people have a preference for "high quality" leisure (taste effect). The demand for informal education is derived in a household production model accounting for both explanations. An empirical investigation finds evidence for both effects with the taste effect being the more important effect. Highly educated people accumulate human capital through their specific leisure time use. This increases the skill-gap between higher and lower educated people.

Keywords: informal education, lifelong learning, time allocation, household production, censored LAD

JEL Classification: C24, D13, J22, J24

Suggested Citation

Fahr, Rene, Loafing or Learning? The Demand for Informal Education (August 2003). IZA Discussion Paper No. 859. Available at SSRN: https://ssrn.com/abstract=445700

Rene Fahr (Contact Author)

University of Paderborn ( email )

Warburger Str. 100
D-33098 Paderborn
Germany
+49 5251 60 3692 (Phone)

HOME PAGE: http://www.quantitative-cg.de

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany
+49 228 38 94 0 (Phone)
+49 228 38 94 510 (Fax)

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