Abstract
Social science has long studied how people participate in economic life, but most of that literature focuses on one sphere of the economy only: either the market economy where goods and services are produced and traded for money, or the household economy where services such as childcare and housework are provided for no pay, mostly by women. These spheres could not exist without each other – the market economy must have workers produced and sustained by households, and households must have incomes from market labor or assets – but they are often not studied in tandem. Most of the study of economics, including economic measurement, concerns itself with the market economy, where men’s production predominates. This chapter describes a methodology that brings the spheres together, to measure how we produce, consume, share, and save resources in both spheres simultaneously. It combines the National Transfer Accounts method of studying market economic flows by age, with a new tool called National Time Transfer Accounts which studies household economic flows of unpaid care work by age. The results reveal how we live in gendered economies shaped by lifecycle processes of birth, death, and household formation.
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Notes
- 1.
This definition appears in multiple dictionaries of language and economics. Two online examples are https://www.thefreedictionary.com/Economic+activity, and http://www.businessdictionary.com/definition/economic-activity.html, both accessed on June 18, 2018.
- 2.
The nomenclature around unpaid care work can be confusing. Time inputs not accounted for in national income should not be confused with unpaid family work in household-owned farms or other enterprises, here referred to as “unpaid family work.” This is in contrast to “unpaid care work” which is the unpaid care and housework not included in national income. Unpaid family work does not generate earnings for the unpaid family laborer, but does produce goods and services traded in the market thus generating income for the household that is already part of national income, or it produces goods consumed by the household which are not traded in a marketplace but are imputed as part of national income. Unpaid care work time inputs are those for which the value of the time is never paid to anyone and is not included in national accounts measures such as Gross Domestic Product or Gross National Income. While the name “household production” has become common in the literature for referring to productive activities not resulting in market goods or services, note that some of the included activities are performed outside of the household for non-household members. Examples are care for persons outside of the household and volunteer activities.
- 3.
The working group maintains notes on progress, documentation, and sample programs at http://www.ntaccounts.org/web/nta/show/Gender%2c%20Time%20use
- 4.
While there is a robust literature working on such estimates within households, the cross-time and cross-sectional nature of NTA estimates make applying these detailed methodologies across countries beyond the scope of NTA and CWW at this time.
- 5.
In the past, some NTA researchers have examined data driven methods to estimate an equivalent consumer scale by sex, but the differences found have been relatively small. Researchers outside of the NTA group argue that a unitary sharing model within the household is inaccurate (Browning and Chiappori 1998) and find that both spousal market income and gender roles contribute to different consumption by gender within the household (Phipps and Burton 1998). Given these previous studies, we would expect women to receive a lower share than same age men in the household, which would lower their consumption and lifecycle deficits. Examining alternatives to the equal gender weights assumption will be an important priority for future revisions of the methodology. For the current methodology, researchers should be clear on the potential for bias in estimates of women’s versus men’s private consumption and sometimes it is more appropriate to show one-group consumption estimates instead of separate sex ones, where it is believed the chances of intra-household gender discrimination are high.
- 6.
See Friedman 1984; also https://stat.ethz.ch/R-manual/R-devel/library/stats/html/supsmu.html for implementation in the R statistical computing program, and https://ideas.repec.org/c/boc/bocode/s458030.html for implementation in the Stata statistical computing program.
- 7.
Some possible definitions of headship are:
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1.
Survey-defined (this is the NTA default)
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2.
Highest wage earner in the household
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3.
Owner or renter of housing unit (if available in survey)
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4.
Equal headship (assign headship-related roles equally to all adults in the household)
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5.
Proportional headship (assign all assets and other headship roles to adult in the household based on their wages or some other indicator)
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1.
- 8.
Sometime use surveys have a full time diary for only one person in the household, others survey all representative adults, or all persons of a certain age or older. If a survey only has information about the age and sex of the time respondent in the household, a household production age profile can be produced based on the methodology here, but not imputed consumption or transfers.
- 9.
If the total number of hours is very close to 24, researchers may adjust all hours so that they equal 24. If respondents show a range of 23–25 h, that range of error is relatively small so the adjustments will not be large. For a person whose answers total 23 h, for example, all of his time allocations could be multiplied by 24/23 = 1.0435 to make a total of 24 h.
- 10.
Keep in mind that aggregate controls may not be available for sub-regions. If they are not, survey-based shares of aggregate activities can be used to apportion national macro controls to sub-regions.
- 11.
Some household management activities may be productive but not meet the third party criterion because they must be done in person. The management of some financial and legal matters might seem like they could be outsourced to a personal assistant, for example, but for activities like applying for bank loans or consulting with lawyers must be done face to face for the most part. Interactions with government entities will also be mixed up between tasks that could be “outsourced” and those which must be done in person. You could have someone else drop off forms or submit tax payments at government entities for you, but for things like applying for a drivers’ license you must present yourself in person to verify your identity. Researchers should examine coding resources closely and make the best guess as to what could be outsourced and what could not.
- 12.
There are gray areas here, especially in personal care. Theoretically you could pay someone else to brush your teeth for you and still get the benefit of clean teeth, but in practice this only occurs at infrequent dental exams.
- 13.
The survey defines “secondary childcare” as responsibility for a child under age 13 while doing another activity. This contrasts with the childcare definition used with primary activities where the “child” is defined as under age 18.
- 14.
For alternate estimates including multitasking, if a unit of time is indicated to have one unpaid care work activity in that time, it should be assigned the full value of that time, even if it is shared with a leisure activity. If the unit of time is assigned to more than one productive activity, researchers should divide the time unit equally among the multiple productive activities. In other words, no unit of time can be counted more than once, but it should be divided among productive activities. For example, if someone spent an hour cooking while taking care of children, those are both productive activities, so it should count as a half-hour of cooking and half-hour of childcare. Similarly if someone spent an hour of paid work also doing childcare, half the hour should count as paid work and the other half as childcare. If the hour was spent cooking and watching television, that is one productive activity and one leisure activity, so the hour is counted as 1 h of cooking. This way of handling multitasking preserves the 24 h day and recognizes the research showing that the “multitasking miracle” is more myth than reality. Several other examples of time use and work show the justification for handling multiple tasks in this way. First, while working at a paid job, a worker is paid for an hour at work even if she was not being productive every minute of that hour or even if she was concurrently doing a leisure activity like listening to the radio. Also, paid breaks or lunch hours are often part of paid work because an employee is still “on the job” at the time. We want to treat unpaid care work in a similar manner and not penalize a less productive use of time or the inclusion of a leisure activity. Second, if someone is doing a leisure activity while responsible for housework or childcare, the time is considered productive because if that adult was not also performing the housework or childcare while doing the leisure activity, he would have to pay someone else to do those productive tasks. Finally, if two productive activities are occurring at the same time, the even split of time attribution means that the total time unit is being valued at a wage which is the average of the two activities.
- 15.
While it has a very big impact on the aggregate value of NTTA accounts, preliminary research indicates that it does not make a huge difference in relative age profiles by sex.
- 16.
The other main valuation alternative is opportunity cost, valuing a person’s time by the amount she could earn in market labor instead. This tends to give a very high estimate because it imputes skilled inputs to jobs that may not require those skills or that require completely different skills. It would also often lead to valuing an hour of home production time by a man as more valuable than by a woman, because men’s wages in the market are generally higher than women’s, whereas the woman might produce a superior output more quickly. A load of clean laundry is likely not worth more if the launderer is more highly educated or commands a higher market wage. For this reason, NTTA will not use opportunity cost-based wage imputation. Another alternative is still a replacement method, but is “generalist replacement” instead of specialist. The generalist replacement method involves finding one appropriate wage that would but used for all household production activities. This is usually a housekeeper wage. This may be appropriate to use in some countries but not in others. If housekeepers are only employed by very wealthy households in a particular country, then the housekeeper wage will be quite high and not a good approximation of what an average household would have to pay to replace the activity in the market. However, in countries where housekeepers are more common and there is sufficient wage data to identify a housekeeper wage, generalist replacement may be used.
- 17.
As more countries gain experience implementing this methodology, we hope to find a standardized way to identify occupations for imputing wages. Researchers should keep a table of the wages used and what occupations or job classifications they represent, as that will be an important table to report in any published work and an important piece of information for the NTA project to gather so we can compare and possibly modify this part of the methodology.
- 18.
This assumes that men and women will be equally productive at the same task, which is most likely a poor assumption. Unpaid care work tasks are delineated by gender in many contexts and we would expect any gender specialization in a task contributes to that gender’s efficiency and productivity at that task. At this point in the research, we do not include any estimates of these effects, but in future revisions, we may investigate methods to adjust imputed wages for men versus women based on the degree of sex-specialization in an activity. For example, if 90% of the household cleaning is done by women, we might estimate some factor by which men’s productivity at household cleaning is lower than women’s. This is a conceptually difficult idea, however. Would we also consider a man’s hour spent doing childcare to be less efficient than a woman’s hour in a context where women do most of the childcare? It is more difficult here to justify an idea of relative efficiency or productivity.
- 19.
Post-tax valuations will be more relevant when the research question is about the choices individuals face to pay for an activity to be performed or to do it themselves. One could argue that an individual will not engage in unpaid care work unless the marginal value of the time spent in unpaid care work is no less than the after-tax market wage that could be earned. Hence, studies using opportunity cost wage values would be more logically done on a post-tax basis, those using replacement costs on a pre-tax basis.
- 20.
For the specialist replacement method, sometime use researchers argue that we should recognize the fact that performing some tasks in the market may be more efficient than in the household. Specialized equipment and training is used in the market but probably less so in the household (Abraham and Mackie 2005). On the other hand, some argue that market production can become less efficient over time, due to short-term profit or other considerations (Braverman 1974). Unfortunately, there have been no systematic efforts to measure the differences in productivity between the market and the household. In some countries’ estimates of unpaid care work accounts, ad hoc estimates of relative efficiency for particular tasks are assigned (Landefeld et al. 2009), but these are arbitrary estimates and may not be appropriate for the type of cross-national estimates that the NTA project produces. In addition to issues of efficiency in the market versus the home, there is also the issue of efficiency of the young versus the old. Failing health and mobility may make older persons much less efficient at unpaid care work than younger persons. We could assume that the wage gradient in the paid labor market for household production activities represents this effect, but few countries will have sufficiently detailed occupation classifications in their survey data to estimate this. Also, applying the market NTA labor income age gradient is not appropriate because at oldest ages, the mix of activities being done by the oldest market workers is very different from the mix of unpaid care work activities they are doing.
- 21.
If, for example, you know from the survey that the time is being spent caring for a non-coresident parent, and you know the age and sex of the parent, assign that production to that age and sex group. Or if you do not know the age of the parent, you could assign the amount to the age group an average generation length older than the age of the time producer. If you do not know if the elderly parent was a mother or father, divide the amount proportionally based on the sex distribution of the target age group.
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Donehower, G. (2019). Methodology of the National Time Transfer Accounts. In: Urdinola, B., Tovar, J. (eds) Time Use and Transfers in the Americas. Springer, Cham. https://doi.org/10.1007/978-3-030-11806-8_2
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