Working Paper: NBER ID: w31954
Authors: Matteo Cacciatore; Daniela Hauser; Stefano Gnocchi
Abstract: We study the effects of uncertainty on time use and their macroeconomic implications. Employing data from the American Time Use Survey and the Bureau of Labor Statistics, we document that heightened uncertainty increases housework and reduces market work hours, mildly impacting leisure. We then propose a model that quantitatively accounts for these estimates. We show that substitution between market and housework provides self-insurance to households, weakening precautionary savings. However, it also reduces aggregate demand, ultimately amplifying uncertainty's recessionary impact. Time reallocation can lead to higher inflation, particularly when uncertainty couples with policies redirecting time use towards housework (e.g., lockdown restrictions).
Keywords: time use; macroeconomic uncertainty; housework; market work; leisure
JEL Codes: E21; E32; J22; J23
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Increase in housework hours (D13) | Reduction in overall market consumption (F61) |
| Heightened uncertainty (D89) | Amplification of recessionary impacts on aggregate demand (E00) |
| Time reallocation towards housework (D13) | Higher inflation (E31) |
| Heightened uncertainty (D89) | Increase in housework hours (D13) |
| Heightened uncertainty (D89) | Decrease in market work hours (J29) |