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A Matter of Quality? Experimental Evidence on Preferences and Willingness to Pay for Domestic Services

Author

Listed:
  • Natascha Nisic

    (Johannes Gutenberg University Mainz)

  • Friederike Molitor

    (Johannes Gutenberg University Mainz)

  • Miriam Trübner

    (Johannes Gutenberg University Mainz)

Abstract

Despite a growing need for domestic help, many households refrain from outsourcing their domestic chores to the market. By drawing on transaction cost theory, the present study sheds light on how demand can be stimulated by overcoming trust problems that are related to the quality and professionalisation of domestic services. The experimental findings from our factorial survey (N=4024) further show how state-subsidised service vouchers not only facilitate outsourcing by alleviating budget constraints, but also how they contribute to better pay for domestic workers while simultaneously reducing the costs for households. Overall, the results support recent policy recommendations that emphasise the role of professionalisation, in combination with service voucher systems, in increasingly shifting paid domestic work from the informal to the formal economy.

Suggested Citation

  • Natascha Nisic & Friederike Molitor & Miriam Trübner, 2022. "A Matter of Quality? Experimental Evidence on Preferences and Willingness to Pay for Domestic Services," Working Papers 2209, Gutenberg School of Management and Economics, Johannes Gutenberg-Universität Mainz.
    • Handle: RePEc:jgu:wpaper:2209
    as

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    File URL: https://download.uni-mainz.de/RePEc/pdf/Discussion_Paper_2209.pdf
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    References listed on IDEAS

    as
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    2. Geissler, Birgit, 2010. "Der private Haushalt als Arbeitsplatzreservoir? Zur Akzeptanz und Abwehr von Haushaltsdienstleistungen," WSI-Mitteilungen, Nomos Verlagsgesellschaft mbH & Co. KG, vol. 63(3), pages 135-142.
    3. Pollak, Robert A, 1985. "A Transaction Cost Approach to Families and Households," Journal of Economic Literature, American Economic Association, vol. 23(2), pages 581-608, June.
    4. Esther de Ruijter & Tanja van der Lippe & Werner Raub, 2003. "Trust Problems in Household Outsourcing," Rationality and Society, , vol. 15(4), pages 473-507, November.
    5. Colin C. Williams & Ioana Alexandra Horodnic & Jan Windebank, 2017. "Explaining participation in the informal economy: a purchaser perspective," International Journal of Social Economics, Emerald Group Publishing Limited, vol. 44(11), pages 1421-1436, November.
    6. Dries Lens & Ive Marx & Jarmila Oslejová & Ninke Mussche, 2021. "Can we steer clear of precariousness in domestic service work? Exploring labour market pathways of Belgian Service Voucher workers," Working Papers 2106, Herman Deleeck Centre for Social Policy, University of Antwerp.
    7. Michael Spence, 1973. "Job Market Signaling," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 87(3), pages 355-374.
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