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The Estimation of Price Elasticities and the Value of Time in a Domestic Production Framework: an Application using French Micro-Data

Author

Listed:
  • François Gardes

    (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

Abstract
This article uses an allocation of time framework following Becker, to propose a new method to estimate the opportunity cost of time and price elasticities at a micro level. As expected, the estimate of the value of time performed by matching the INSEE Family Budget and Time Use surveys is close to the minimum wage rate and positively correlated with household wages, incomes and relative incomes, as well as with the presence of children. Using this estimate, full prices are derived, allowing the computation of cross-section data of price elasticities, elasticities with respect to time use, as well as to the opportunity cost of time.

Suggested Citation

  • François Gardes, 2019. "The Estimation of Price Elasticities and the Value of Time in a Domestic Production Framework: an Application using French Micro-Data," Post-Print hal-01478052, HAL.
    • Handle: RePEc:hal:journl:hal-01478052
    DOI: 10.15609/annaeconstat2009.135.0089
    Note: View the original document on HAL open archive server: https://hal.science/hal-01478052
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    References listed on IDEAS

    as
    1. Deaton, Angus, 1988. "Quality, Quantity, and Spatial Variation of Price," American Economic Review, American Economic Association, vol. 78(3), pages 418-430, June.
    2. Carla Canelas & François Gardes & Philip Merrigan & Silvia Salazar, 2019. "Are time and money equally substitutable for all commodity groups in the household’s domestic production?," Review of Economics of the Household, Springer, vol. 17(1), pages 267-285, March.
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    20. François Gardes, 2018. "On the value of time and human life," Documents de travail du Centre d'Economie de la Sorbonne 18028, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    21. François Gardes & Noël Thiombiano, 2017. "The value of time and expenditures of rural households in Burkina Faso: a domestic production framework," Documents de travail du Centre d'Economie de la Sorbonne 17027, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
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    25. François Gardes & Imen Sayadi & Christophe Starzec, 2015. "Les échelles d’équivalence complètes : une estimation intégrant les dimensions monétaire et temporelle des dépenses des ménages," Revue d'économie politique, Dalloz, vol. 125(3), pages 393-414.
    26. Jens Bonke & Martin Browning, 2009. "The Allocation of Expenditures within the Household: A New Survey," Fiscal Studies, Institute for Fiscal Studies, vol. 30(Special I), pages 461-481, December.
    27. François Gardes, 2014. "Full price elasticities and the value of time: A tribute to the Beckerian model of the allocation of time," Documents de travail du Centre d'Economie de la Sorbonne 14014, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
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