The Time and Timing Costs of Market Work, and Their Implications for Retirement

38 Pages Posted: 24 Mar 2006

See all articles by Daniel S. Hamermesh

Daniel S. Hamermesh

University of Texas at Austin - Department of Economics; National Bureau of Economic Research (NBER); IZA Institute of Labor Economics

Date Written: March 2006

Abstract

Retirement ages among older Americans have only recently begun to increase after a precipitous fifty-year decline. Early retirement may result from incentives provided by retirement systems; but it may also result from the rigidities imposed by market work schedules. Using the American Time Use Survey of 2003 and 2004, I first examine whether additional market work is neutral with respect to the mix of non-market activities. The estimates indicate that there are fixed time costs of remaining in the labor market that alter the pattern of non-market activities, reducing leisure time and mostly increasing time devoted to household production. Market work also alters the timing of a fixed amount of non-market activities during the day, away from the schedule chosen when timing constraints imposed by market work do not exist. All of these effects are mitigated by higher family income, presumably because higher-income people can purchase market substitutes that enable them to overcome the fixed time costs of market work.

Keywords: household production, non-market activity, labor-force behavior

JEL Classification: J22, D13, J26

Suggested Citation

Hamermesh, Daniel S., The Time and Timing Costs of Market Work, and Their Implications for Retirement (March 2006). IZA Discussion Paper No. 2030, Available at SSRN: https://ssrn.com/abstract=892823 or http://dx.doi.org/10.2139/ssrn.892823

Daniel S. Hamermesh (Contact Author)

University of Texas at Austin - Department of Economics ( email )

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United States
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National Bureau of Economic Research (NBER)

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IZA Institute of Labor Economics

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