Housework and fiscal expansions
Gnocchi, Stefano (Bank of Canada)
Hauser, Daniela Stefanie (Bank of Canada)
Pappa, Evi ![ORCID Identifier](/img/uab/orcid.ico)
(Universitat Autònoma de Barcelona)
Imprint: |
Otawa : Bank of Canada, 2014 |
Description: |
40 pag. |
Abstract: |
We build an otherwise-standard business cycle model with housework, calibrated consistently with data on time use, in order to discipline consumption-hours complementarity and relate its strength to the size of fiscal multipliers. We show that if substitutability between home and market goods is calibrated on the empirically relevant range, consumption-hours complementarity is large and the model generates fiscal multipliers that agree with the evidence. Hence, our analysis supports the relevance of consumption-hours complementarity for fiscal multipliers. However, we also find that explicitly modeling the home sector is more appealing than restricting to the consumption-leisure margin and/or to the preferences proposed by Greenwood, Hercowitz and Huffman (1988). A housework model can imply substantial complementarity, without low wealth effects contradicting the microeconomic evidence. |
Grants: |
Ministerio de Educación y Ciencia ECO2009-09847
|
Rights: |
Tots els drets reservats. ![](/img/licenses/InC.ico) |
Language: |
Anglès |
Series: |
Bank of Canada Working Paper ; 2014-34 |
Document: |
Working paper |
Subject: |
Fiscal policy ;
Business fluctuations and cycles |
Published in: |
Staff Working Papers, 34 (2014) , ISSN 1701-9397 |
Adreça alternativa: https://hdl.handle.net/10419/103020
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Record created 2020-03-27, last modified 2022-09-03