Working Paper: NBER ID: w27744
Authors: Alexandr Kopytov; Nikolai Roussanov; Mathieu Taschereau-Dumouchel
Abstract: Recreation prices and hours worked have both fallen over the last century. We construct a macroeconomic model with general preferences that allows for trending recreation prices, wages, and work hours along a balanced-growth path. Estimating the model using aggregate data from OECD countries, we find that the fall in recreation prices can explain a large fraction of the decline in hours. We also use our model to show that the diverging prices of the recreation bundles consumed by different demographic groups can account for much of the increase in leisure inequality observed in the United States over the last decades.
Keywords: leisure; work hours; recreation prices; income effect; leisure inequality
JEL Codes: E24; J22; J32
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Diverging prices of recreation bundles (P22) | Changes in leisure inequality (D31) |
| Falling prices of recreation goods (E31) | Increased leisure time for less-educated households (D13) |
| Decline in recreation prices (Q26) | Increase in leisure time (J29) |
| Decline in recreation prices (Q26) | Decline in hours worked (J22) |
| Rising wages (J39) | Decline in hours worked (J22) |
| Decline in recreation prices + Rising wages (J39) | Decline in hours worked (J22) |