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Reinhard Madlener - One of the best experts on this subject based on the ideXlab platform.
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revisiting heat energy consumption modeling Household Production theory applied to field experimental data
Energy Policy, 2021Co-Authors: Florian Heesen, Reinhard MadlenerAbstract:Abstract This paper offers new insights on utility-driven heat energy consumption derived from using an interdisciplinary modeling framework that is based on Becker's Household Production theory. The research question addressed is whether economic aspects affect short-term, less conscious behavior in the same way as long-term, more conscious behavior. From the investigation, new insights on the usefulness of price-based energy policy measures targeting heat energy consumption are gained. The Household Production model proposed for analyzing residential heat energy demand integrates economic, engineering and behavioral elements. Comparative statics enables an interdisciplinary integration of price- and income functions to cover economic influences on heat energy (service) consumption, the Production function to cover technical influences, and the utility-based choice architecture to cover utility maximization influences. Based on a functional representation of the theories, a panel data model of heat energy consumption is estimated. The empirical analysis is based on data from 60 adjacent apartments in South-West Germany. We find empirical evidence that the price elasticity of demand is only statistically significant when using yearly aggregated data. This result provides evidence that occupants apparently do not act much based upon energy price levels when following their daily home heating routine. In less frequent considerations, as e.g. according to their yearly billing cycles, occupants adjust their heat energy consumption in response to the fuel price changes noticed on the energy bill. Furthermore, in relation to the other influences on heat energy consumption, we find that the price impact is less pronounced than the impact of comfort conditions. Therefore, a CO2 price on heat energy might set the right incentives to invest in more energy-efficient heating technology, but hardly alter comfort-taking or rebound effects.
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Revisiting Heat Energy Consumption Modeling: Household Production Theory Applied to Field Experimental Data
SSRN Electronic Journal, 2018Co-Authors: Florian Heesen, Reinhard MadlenerAbstract:This paper offers new insights on utility-driven heat energy consumption. The research question addressed is whether economic aspects affect short-term, less conscious behavior in the same way as long-term, more conscious behavior. The model proposed is based on Becker’s Household Production theory and integrates economic, engineering and behavioral elements. Comparative statics enables an interdisciplinary integration of price- and income functions to cover economic influences, the Production function to cover technical influences, and the utility-based choice architecture. Based on a functional representation of the theories, a panel data model of heat energy consumption is estimated. The empirical analysis is based on data from 60 adjacent apartments in South-West Germany. We find empirical evidence that the price elasticity of demand is only statistically significant when using yearly aggregated data. This result provides evidence that occupants apparently do not act upon energy price signals when following their daily home heating routine. In less frequent considerations, as e.g. according to their yearly billing cycles, occupants adjust their heat energy consumption with respect to the fuel price influence. Furthermore, in relation to the other influences on heat energy consumption, we find that the price impact is less pronounced than the impact of comfort conditions.
Randall Wright - One of the best experts on this subject based on the ideXlab platform.
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homework in monetary economics inflation home Production and the Production of homes
Review of Economic Dynamics, 2016Co-Authors: Boragan S Aruoba, Morris A Davis, Randall WrightAbstract:Abstract We introduce Household Production and the Production of houses (construction) into a monetary model. Theory predicts inflation, as a tax on market activity, encourages substitution into Household Production and hence investment in housing. In the model, the stock and appropriately-deflated price of housing increase with inflation or nominal interest rates. We document this in data for the U.S. and other countries. A calibrated model accounts for up to 52 % ( 87 % ) of the relationship between interest rates and housing wealth deflated by nominal output (by the money supply). It also implies the cost of inflation is higher than in models without home Production.
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homework in monetary economics inflation home Production and the Production of homes
National Bureau of Economic Research, 2012Co-Authors: Boragan S Aruoba, Morris A Davis, Randall WrightAbstract:We study models incorporating money, Household Production, and investment in housing. Inflation, as a tax on market activity, encourages substitution into Household Production, and thus investment in Household capital. Hence, inflation increases the (appropriately deflated) value of the housing stock. This is documented in various data sources. A calibrated model accounts for a fifth to a half of the observed relationships. While this leaves much to be explained, it demonstrates the channel is economically relevant. We also show models with home Production imply higher costs of inflation than models without it, especially when home and market goods are close substitutes.
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homework in labor economics Household Production and intertemporal substitution
Journal of Monetary Economics, 2000Co-Authors: Peter Rupert, Richard Rogerson, Randall WrightAbstract:We argue that estimates of intertemporal substitution elasticities obtained from standard life cycle models are subject to a downward bias because they neglect changes in work done at home over the life cycle. We extend the standard life cycle model to include home Production and estimate it using data from three time use surveys. We find that the downward bias is large.
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homework in development economics Household Production and the wealth of nations
Journal of Political Economy, 2000Co-Authors: Stephen L Parente, Richard Rogerson, Randall WrightAbstract:We introduce home Production into the neoclassical growth model and examine its consequences for development economics. In particular, we study the extent to which one can account for international income differences with differences in policies that distort capital accumulation. In models with home Production, such policies not only reduce capital accumulation but also change the mix of market and nonmarket activity. Hence these models can generate larger differences in output than standard models for a given policy differential. We also show how the welfare implications change when we incorporate home Production.
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an equilibrium model of the business cycle with Household Production and fiscal policy
International Economic Review, 1997Co-Authors: Ellen R Mcgrattan, Richard Rogerson, Randall WrightAbstract:The authors estimate a dynamic general equilibrium model of the U.S. economy that includes an explicit Household Production sector and stochastic fiscal variables. They use their estimates to investigate two issues. First, the authors analyze how well the model accounts for aggregate fluctuations. They find that Household Production has a significant impact and reject a nested specification in which changes in the home Production technology do not matter for market variables. Second, the authors study the effects of some simple fiscal policy experiments and show that the model generates different predictions for the effects of tax changes than similar models without home Production. Copyright 1997 by Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association.
Nezih Guner - One of the best experts on this subject based on the ideXlab platform.
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marriage and divorce since world war ii analyzing the role of technological progress on the formation of Households
Nber Macroeconomics Annual, 2008Co-Authors: Jeremy Greenwood, Nezih GunerAbstract:Since World War II there has been: (i) a rise in the fraction of time that married Households allocate to market work, (ii) an increase in the rate of divorce, and (iii) a decline in the rate of marriage. What can explain this? It is argued here that technological progress in the Household sector has saved on the need for labor at home. This makes it more feasible for singles to maintain their own home, and for married women to work. To address this question, a search model of marriage and divorce is developed. Household Production bene…ts from labor-saving technological progress.
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marriage and divorce since world war ii analyzing the role of technological progress on the formation of Households
Social Science Research Network, 2008Co-Authors: Jeremy Greenwood, Nezih GunerAbstract:Since World War II there has been: (i) a rise in the fraction of time that married Households allocate to market work, (ii) an increase in the rate of divorce, and (iii) a decline in the rate of marriage. It is argued here that labor-saving technological progress in the Household sector can explain these facts. This makes it more feasible for singles to maintain their own home, and for married women to work. To address this question, a search model of marriage and divorce, which incorporates Household Production, is developed. An extension looks back at the prewar era.
Daniel S. Hamermesh - One of the best experts on this subject based on the ideXlab platform.
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unemployment market work and Household Production
Economics Letters, 2010Co-Authors: Michael C Burda, Daniel S. HamermeshAbstract:Time-diary data from four countries suggest that differences in market time between the unemployed and employed represent additional leisure, not increased Household Production. In areas where unemployment is cyclically high, however, reduced market work is offset by additional home Production.
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unemployment market work and Household Production
Research Papers in Economics, 2009Co-Authors: Michael C Burda, Daniel S. HamermeshAbstract:Using time-diary data from four countries we show that the unemployed spend most of the time not working for pay in additional leisure and personal maintenance, not in increased Household Production. There is no relation between unemployment duration and the split of time between Household Production and leisure. U.S. data for 2003-2006 show that almost none of the lower amount of market work in areas of long-term high unemployment is offset by additional Household Production. In contrast, in those areas where unemployment has risen cyclically reduced market work is made up almost entirely by additional time spent in Household Production.
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the demand for variety a Household Production perspective
The Review of Economics and Statistics, 2008Co-Authors: Reuben Gronau, Daniel S. HamermeshAbstract:Product diversity pervades every modern marketplace, and economists have devoted substantial attention to firms' decisions about the supply of variety. This study looks at the consumer's side by discussing the demand for variety. Using the framework of the home-Production model, we trace differences in demand to differences in the opportunity costs of various activities. The cost differences are associated with investments in human capital; and the resulting differences in schooling attainment produce differences in time costs that in turn alter the kinds and variety of activities in which Household members engage. Using time-budget surveys from Australia, Israel, the Netherlands, Sweden, the United States and West Germany from between 1985 and 1994, we find substantial differences among Households in the extent of variety in the nonwork activities that they produce. More educated individuals generate more variety, engaging in both additional activities and the same ones as the less educated, with most of the effect of education on the variety of nonroutine activities. There is more variety on weekends; women engage in more different activities than men; young children add to variety in Household consumption/Production, especially among women; and income effects are clearly positive.
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time to eat Household Production under increasing income inequality
American Journal of Agricultural Economics, 2007Co-Authors: Daniel S. HamermeshAbstract:Eating requires the raw food materials that make up meals and also the time devoted to buying food, preparing meals and eating them, and cleaning up afterwards. Using time-diary and expenditure data for the U.S. for 1985 and 2003, I examine how income and time prices affect time and goods inputs into this Household-produced commodity. Focusing on these two years, between which income and earnings inequality increased, allows examining how Household Production is affected by changing economic opportunities. The results demonstrate that both inputs into eating increase with income, and that higher time prices at a given level of income reduce time inputs. Over this period the relative goods intensity of producing this commodity increased, especially at the lower part of the income distribution, and the average time input dropped substantially. The results are consistent with goods-time substitution being relatively difficult for eating and with substitution being more difficult as Production expands.
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the demand for variety a Household Production perspective
Research Papers in Economics, 2007Co-Authors: Daniel S. Hamermesh, Reuben GronauAbstract: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.
Florian Heesen - One of the best experts on this subject based on the ideXlab platform.
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revisiting heat energy consumption modeling Household Production theory applied to field experimental data
Energy Policy, 2021Co-Authors: Florian Heesen, Reinhard MadlenerAbstract:Abstract This paper offers new insights on utility-driven heat energy consumption derived from using an interdisciplinary modeling framework that is based on Becker's Household Production theory. The research question addressed is whether economic aspects affect short-term, less conscious behavior in the same way as long-term, more conscious behavior. From the investigation, new insights on the usefulness of price-based energy policy measures targeting heat energy consumption are gained. The Household Production model proposed for analyzing residential heat energy demand integrates economic, engineering and behavioral elements. Comparative statics enables an interdisciplinary integration of price- and income functions to cover economic influences on heat energy (service) consumption, the Production function to cover technical influences, and the utility-based choice architecture to cover utility maximization influences. Based on a functional representation of the theories, a panel data model of heat energy consumption is estimated. The empirical analysis is based on data from 60 adjacent apartments in South-West Germany. We find empirical evidence that the price elasticity of demand is only statistically significant when using yearly aggregated data. This result provides evidence that occupants apparently do not act much based upon energy price levels when following their daily home heating routine. In less frequent considerations, as e.g. according to their yearly billing cycles, occupants adjust their heat energy consumption in response to the fuel price changes noticed on the energy bill. Furthermore, in relation to the other influences on heat energy consumption, we find that the price impact is less pronounced than the impact of comfort conditions. Therefore, a CO2 price on heat energy might set the right incentives to invest in more energy-efficient heating technology, but hardly alter comfort-taking or rebound effects.
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Revisiting Heat Energy Consumption Modeling: Household Production Theory Applied to Field Experimental Data
SSRN Electronic Journal, 2018Co-Authors: Florian Heesen, Reinhard MadlenerAbstract:This paper offers new insights on utility-driven heat energy consumption. The research question addressed is whether economic aspects affect short-term, less conscious behavior in the same way as long-term, more conscious behavior. The model proposed is based on Becker’s Household Production theory and integrates economic, engineering and behavioral elements. Comparative statics enables an interdisciplinary integration of price- and income functions to cover economic influences, the Production function to cover technical influences, and the utility-based choice architecture. Based on a functional representation of the theories, a panel data model of heat energy consumption is estimated. The empirical analysis is based on data from 60 adjacent apartments in South-West Germany. We find empirical evidence that the price elasticity of demand is only statistically significant when using yearly aggregated data. This result provides evidence that occupants apparently do not act upon energy price signals when following their daily home heating routine. In less frequent considerations, as e.g. according to their yearly billing cycles, occupants adjust their heat energy consumption with respect to the fuel price influence. Furthermore, in relation to the other influences on heat energy consumption, we find that the price impact is less pronounced than the impact of comfort conditions.