The Demand for Variety: A Household Production Perspective

33 Pages Posted: 7 May 2007

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

Reuben Gronau

Hebrew University of Jerusalem - Department of Economics; National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Date Written: April 2007

Abstract

Economists have devoted substantial attention to firms' supply of variety, but little to consumers' demand for variety. Employing the framework of home production, we trace differences in demand to differences in the opportunity costs of activities, which are associated with investments in human capital. Schooling alters time costs and changes the variety of activities household members choose. In time budgets from Australia, Israel, and West Germany we find that higher own and spouses' incomes raise variety (suggesting positive income effects). Education increases variety independent of income and earnings; part of its impact goes beyond a correlation of educational attainment with preferences for variety.

Keywords: time use, education, gender

JEL Classification: D13, J22

Suggested Citation

Hamermesh, Daniel S. and Gronau, Reuben, The Demand for Variety: A Household Production Perspective (April 2007). IZA Discussion Paper No. 2767. Available at SSRN: https://ssrn.com/abstract=984436

Daniel S. Hamermesh (Contact Author)

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

Austin, TX 78712
United States
512-475-8526 (Phone)
512-471-3510 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Reuben Gronau

Hebrew University of Jerusalem - Department of Economics ( email )

Mount Scopus
Jerusalem, 91905
Israel
972-2-588-3145 (Phone)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Register to save articles to
your library

Register

Paper statistics

Downloads
73
rank
249,321
Abstract Views
550
PlumX Metrics