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Nonmarket household time and the cost of children
Journal of Business and Economic Statistics
American Statistical Association
A distinguishing feature among households is whether adult members work or not, since the occupational status of adults affects their available time for home activities. Using a survey method in two countries, Belgium and Germany, we provide household incomes that retain the level of well-being across different family types, distinguished by family size and occupational status of adults. Our tests support that childcare-time costs are important determinants of household well-being. Estimates of child costs relative to an adult are higher for households that are time-constrained (all adults in the household work). Moreover, we find supportive evidence for the hypothesis that, in two-adult households, there is a potential for within-household welfare gains from specialization in market- vs. domestic activities, especially childcare.
Formerly published as working paper by University of Vienna, Department of Economics. Authors' draft dated March 2007. Final version available at http://pubs.amstat.org/
Journal of Business and Economic Statistics, January, Vol. 27(1), pp.42-51