The Economic Organization of the Household

Cover......Page 1
Half-title......Page 3
Title......Page 5
Copyright......Page 6
Dedication......Page 7
Contents......Page 9
Figures......Page 11
Preface to the Second Edition......Page 15
One Introduction......Page 19
Goals......Page 21
Activities......Page 22
Technological Constraints......Page 23
The Organization of the Chapters......Page 24
the budget constraint......Page 26
Relative Prices......Page 29
Changes in Prices......Page 30
Size of Income......Page 31
preferences......Page 32
the marginal rate of substitution......Page 36
substitutes and complements......Page 39
putting the parts together: consumer equilibrium......Page 42
summary......Page 48
Mathematical Notes......Page 49
introduction......Page 52
income effects......Page 55
Engel Curves......Page 58
The Income Elasticity of Demand......Page 59
Interpreting Income Elasticities......Page 62
Uses of Income Elasticities......Page 63
The Own-Price Effect......Page 64
The Own-Price Elasticity of Demand......Page 65
An Example......Page 67
Uses of Price Elasticities......Page 68
the household's demand curve......Page 69
Income and Substitution Effects......Page 70
The Geometry of Income and Substitution Effects......Page 71
Quantity Discounts: The Case of College Classes......Page 75
Cash versus In-Kind Transfers: The Food Stamps Example......Page 78
Two-Part Prices: The Racquetball Club Racket......Page 81
Electricity Rates: Block Rate Pricing......Page 82
purchase versus nonpurchase behavior......Page 85
cross-price effects......Page 88
Cross-Price Elasticities......Page 91
Household Size and Composition Effects......Page 93
Mathematical Notes......Page 97
introduction......Page 103
a consumption and saving model of the household......Page 106
The Household’s Intertemporal Budget Constraint......Page 107
The Household’s Time Preference Map......Page 110
Intertemporal Satisfaction Maximization......Page 115
the resource-consumption-saving relation......Page 116
the absolute income hypothesis......Page 119
the permanent and life-cycle income hypotheses......Page 121
The Income Effect of the Change in the Interest Rate......Page 131
changes in the prices of consumption goods through time......Page 134
summary......Page 138
Mathematical Notes......Page 139
introduction......Page 143
The Utility Function......Page 146
The Time Constraint......Page 147
The Household Production Function......Page 149
The Market Work Budget Constraint......Page 155
The Total Household Budget Line......Page 158
income effects on the work behavior of the household......Page 165
wage rate effects on time use......Page 170
specialization of function and the division of labor......Page 177
cross-wage-rate effects......Page 179
technical change effects......Page 182
preference effects......Page 183
Household Size, Household Composition, and Time Use......Page 184
An Analysis of an Income Tax......Page 188
Welfare Programs: The Case of the Earned Income Tax Credit......Page 191
Voluntary Unemployment and the Reservation Wage......Page 197
Involuntary Unemployment......Page 201
time and consumption allocation over the life cycle......Page 203
summary......Page 209
Mathematical Notes......Page 210
Six Human Capital: Investing in Oneself and One’s Family......Page 216
human capital as saving......Page 217
human capital and the labor market......Page 219
The Rate of Return on Education......Page 220
The Demand Curve for Formal Education......Page 222
Experience as a Form of Human Capital......Page 225
Signaling: An Alternative Explanation......Page 230
the timing of formal schooling and experience......Page 232
health as a human capital investment......Page 233
A Simple One-Period Health Model......Page 235
Empirical Work......Page 238
children as a human capital investment......Page 241
Expectations and the Sex Typing of Human Capital Investments......Page 244
Human Capital and Household Type......Page 247
Mathematical Notes......Page 249
introduction......Page 254
a simple model of fertility......Page 258
The Effect of Wage Rate Changes......Page 263
The Effect of Changes in the Price of Children......Page 266
Income Effects on Fertility......Page 268
The Effect of Preference Shifters, Z......Page 271
Contraceptive Knowledge, Use, and Cost......Page 274
summary......Page 276
Mathematical Notes......Page 277
introduction......Page 280
a model of marriage......Page 281
The Gains from Marriage......Page 285
The Decision to Marry......Page 294
The Ratio of Males to Females......Page 296
Changes in Wage Rates......Page 303
Costs of Marriage......Page 307
a model of divorce......Page 308
Positive and Negative Assortative Mating and Divorce......Page 313
Marriage-Specific Human Capital and Divorce......Page 314
marriage and out-of-wedlock births......Page 317
summary......Page 322
Mathematical Notes......Page 323
References......Page 325
Index......Page 337