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Buying Less but Shopping More: The Use of Nonmarket Labor during a Crisis

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  • David McKenzie
  • Ernesto Schargrodsky

Abstract

Households allocating time between market and non-market uses should respond to income variations by adjusting the time devoted to shopping search and other home production activities. In this paper, we exploit high-frequency household expenditure data to examine the use of changes in shopping intensity as a method of mitigating the effects of the 2002 Argentine economic crisis. Although the total quantity and real value of goods purchased fell during the crisis, consumers are found to be doing more shopping search. This increase in shopping is shown to enable households to seek out lower prices and locate substitutes, allowing a given level of expenditure to buy more goods. The magnitude and prevalence of these effects suggest that this non-market use of labor can be an important coping strategy for households during a recession.

Suggested Citation

  • David McKenzie & Ernesto Schargrodsky, 2011. "Buying Less but Shopping More: The Use of Nonmarket Labor during a Crisis," Economía Journal, The Latin American and Caribbean Economic Association - LACEA, vol. 0(Spring 20), pages 1-43, January.
    • Handle: RePEc:col:000425:008450
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    Cited by:

    1. Laurine Martinoty, 2014. "Intra-Household Coping Mechanisms in Hard Times: the Added Worker Effect in the 2001 Argentine Economic Crisis," Post-Print halshs-01076566, HAL.
    2. Gibson, John & Kim, Bonggeun, 2013. "Do the urban poor face higher food prices? Evidence from Vietnam," Food Policy, Elsevier, vol. 41(C), pages 193-203.
    3. Kaytaz, Mehmet & Gul, Misra C., 2014. "Consumer response to economic crisis and lessons for marketers: The Turkish experience," Journal of Business Research, Elsevier, vol. 67(1), pages 2701-2706.
    4. Jesús Tomás Monge Moreno & Manuel Monge, 2023. "Coronavirus, Vaccination and the Reaction of Consumer Sentiment in The United States: Time Trends and Persistence Analysis," Mathematics, MDPI, vol. 11(8), pages 1-8, April.
    5. Irene Brambilla y Romina Tomé, 2014. "Imports and Welfare: Variety Losses of the Argentine Crisis of 2001-2002," Económica, Departamento de Economía, Facultad de Ciencias Económicas, Universidad Nacional de La Plata, vol. 60, pages 45-75, January-D.
    6. Eunice Minjoo Kang & Seul Ki Lee, 2022. "The Impact of Monetary Benefits in a Pandemic Situation—Navigating Changes in Customer Loyalty through Negative Switching Barriers in the Hotel Industry," Sustainability, MDPI, vol. 14(13), pages 1-19, July.
    7. Hasan, Syed & Shakur, Shamim & Breunig, Robert, 2021. "Exchange rates and expenditure of households with foreign-born members: Evidence from Australia," Journal of Economic Behavior & Organization, Elsevier, vol. 188(C), pages 977-997.
    8. David R. Munro, 2021. "Consumer Behavior and Firm Volatility," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 53(4), pages 845-873, June.
    9. Arabage, Amanda Cappellazzo & Souza, André Portela Fernandes de, 2015. "Labor earnings dynamics in post-stabilization Brazil," Textos para discussão 390, FGV EESP - Escola de Economia de São Paulo, Fundação Getulio Vargas (Brazil).
    10. Bhardwaj,Abhishek & Ghose,Devaki & Mukherjee,Saptarshi & Singh,Manpreet, 2022. "Million Dollar Plants and Retail Prices," Policy Research Working Paper Series 9995, The World Bank.
    11. Johnston Richard & Hogg Ryan & Miller Kristel, 2021. "Who is Most Vulnerable? Exploring Job Vulnerability, Social Distancing and Demand During COVID-19," The Irish Journal of Management, Sciendo, vol. 40(2), pages 100-142, December.
    12. Beatty, Timothy K.M., 2016. "Food Price Variation over the SNAP Benefit Cycle," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 236012, Agricultural and Applied Economics Association.
    13. Olabisi, Michael & Richardson, Robert B., 2022. "Why the poor pay higher energy prices: Evidence from Tanzania," World Development Perspectives, Elsevier, vol. 26(C).
    14. Esa Karonen & Mikko Niemelä, 2022. "Necessity-Rich, Leisure-Poor: The Long-Term Relationship Between Income Cohorts and Consumption Through Age-Period-Cohort Analysis," Journal of Family and Economic Issues, Springer, vol. 43(3), pages 599-620, September.

    More about this item

    Keywords

    time allocation; non-market labor; crisis mitigation; aggregate shocks;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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