Lecture Short course in Household Economics

Abstract

Households play a central role in producing essential META-goods such as children’s human capital, care for elderly relatives, and nutrition. This course presents a framework of household decision-making that explicitly incorporates the production of these meta-goods and the role of spouses or partners in that process.
The model highlights two key forms of substitution. First, households can substitute between home production and market provision, such as cooking at home versus eating out. Second, they can substitute between partners within the household, as tasks such as caregiving or meal preparation can be performed by either spouse. These substitution margins generate new insights into how households allocate time and resources across members and activities. The framework helps interpret widely documented gaps in behavior among individuals in couples, including differences by gender, age, income, education, and other characteristics in consumption, labor supply, and time spent on caregiving and domestic work. Rather than viewing these gaps solely as outcomes of preferences or constraints at the individual level, the model emphasizes the importance of household production and intra-household allocation.
The course emphasizes the important role of explanatory factors related to marriage markets, such as sex ratios, changes in marriage and divorce laws, and characteristics that influence the likelihood of partnering. These factors shape both the availability of partners and the division of labor within households, thereby affecting observed economic behavior.
The conceptual foundations presented here are applicable whenever the topic of research involves household production. This includes analyses of labor supply, caregiving, and consumption decisions.