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Household consumption and home production at retirement in Thailand: evidence from a regression discontinuity approach

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  • Sasiwooth WONGMONTA

    (Burapha University)

Abstract

This paper uses Socio-Economic Surveys covering the period from 2013 to 2019 and the 2015 Time Use Survey to investigate the extent to which household consumption changes at retirement in Thailand. A fuzzy regression discontinuity design is applied to evaluate the retirement effect on total household expenditure and expenditures on four major categories: food-at-home, work-related items, non-durable entertainment, and others. The results reveal that retirement decreases household expenditure by 11%. Further investigations show that the dramatic declines in expenditures on work-related and non-durable entertainment contribute significantly to the spending drop at retirement. The magnitudes of the declines are more pronounced for low-income and low-wealth households. The results also indicate that the retirees spend more leisure time on home production activities after retirement. Once accounting for this effect, it finds that the drop in total household expenditure decreases to 6%. These results suggest that the sizable consumption expenditure drop at retirement is due to substituting away from market purchased goods toward home-produced goods.

Suggested Citation

  • Sasiwooth WONGMONTA, 2022. "Household consumption and home production at retirement in Thailand: evidence from a regression discontinuity approach," JODE - Journal of Demographic Economics, Cambridge University Press, vol. 88(4), pages 563-587, December.
    • Handle: RePEc:ctl:louvde:v:88:y:2022:i:4:p:563-587
    DOI: 10.1017/dem.2021.32
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    More about this item

    Keywords

    Consumption; Home Production; Regression discontinuity; Retirement; Thailand;
    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
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies

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