Taxation and the Consumption of Household Time

The impact of taxation on the allocation of time within households to market work, home production, and child care is empirically examined using cross-section data on a sample of two-earner families. Taxes are found to have little effect on the two-earner family's allocation of time, compared with other factors, such as the number and ages of children in the family. Studies of the consumption of household time typ-ically focus on market uses of family time, either neglecting non market uses of time or treating them as a time residual in the same category as leisure. 1 One of the first studies to examine the home production behavior offamilies was by Reid (1934), who carefully tabulated hours devoted to non market work by eco-nomic and demographic characteristics. She found in-come, family size and composition, and location of residence to be important determinants of time spent in home production. The pioneering work of Mincer (1962) opened the way for viewing the allocation of time decision as not simply between work and leisure, but between work in the market, work at home, and leisure. With a par-ticular interest in the impact of education on time in-puts to household activities, Leibowitz (1974) applied econometric techniques to study the influences on time spent in household production. She found that the number and ages of children are important influ-ences on time spent in home production, but that pro-ductivity factors such as education have a weak effect. In the Leibowitz study, wage rates were omitted from the specification so the separate influence of education on home production activity could not be studied. Recently, a few studies have explored the influence of the wage rate on the allocation of time to market and nonmarket activities. Bloch (1973) used the 1964 National Study of Work and Planning to estimate home production and labor supply functions for hus-bands and wives. Bloch found that hours devoted to home production vary inversely with the wage rate and positively with the number of children. Gronau (1977), using data drawn from the Michigan Income