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Home Production and Leisure During the COVID-19 Recession

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  • Oksana Leukhina
  • Zhixiu Yu

Abstract

Between the months of February and April of 2020, average weekly market hours dropped by 6.25, meanwhile 35% of commuting workers reported switching to remote work arrangements. In this paper, we examine implications of these changes for the time allocation of different households, and on aggregate. We estimate that home production activity increased by 2.1 hours a week, or 34% of lost market hours, whereas leisure activity increased by 3.8 hours a week. The monthly value of home production increased by $30.83 billion – that is 10.5% of the concurrent $292.61 billion drop in monthly GDP. Although market hours declined the most for single, less educated individuals, the lost market hours were absorbed into home production the most by married individuals with children.

Suggested Citation

  • Oksana Leukhina & Zhixiu Yu, 2020. "Home Production and Leisure During the COVID-19 Recession," Working Papers 2020-025, Federal Reserve Bank of St. Louis.
    • Handle: RePEc:fip:fedlwp:88542
    DOI: 10.20955/wp.2020.025
    Note: Publisher DOI: https://doi.org/10.1515/bejm-2020-0271
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    References listed on IDEAS

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    9. McGrattan, Ellen R & Rogerson, Richard & Wright, Randall, 1997. "An Equilibrium Model of the Business Cycle with Household Production and Fiscal Policy," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 38(2), pages 267-290, May.
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    Cited by:

    1. Matteo Cacciatore & Stefano Gnocchi & Daniela Hauser, 2023. "Time Use and Macroeconomic Uncertainty," Staff Working Papers 23-29, Bank of Canada.
    2. You, Wen & Davis, George C. & Yang, Jinyang, 2022. "Viewpoint: An assessment of recent SNAP benefit increases allowing for money and time variability," Food Policy, Elsevier, vol. 106(C).
    3. Kikuchi, Shinnosuke & Kitao, Sagiri & Mikoshiba, Minamo, 2021. "Who suffers from the COVID-19 shocks? Labor market heterogeneity and welfare consequences in Japan," Journal of the Japanese and International Economies, Elsevier, vol. 59(C).
    4. Makoto Nirei & Nao Sudo, 2020. "Necessities, Home Production, and Economic Impacts of Stay-at-Home Policies," IMES Discussion Paper Series 20-E-14, Institute for Monetary and Economic Studies, Bank of Japan.

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    More about this item

    Keywords

    Shutdown; pandemic; remote work; home production; COVID-19;
    All these keywords.

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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