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Estimating the Value of Home Work Time: The Impact of Income Taxes
Author(s) -
Bryan William R.,
Linke Charles M.
Publication year - 1985
Publication title -
home economics research journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.372
H-Index - 31
eISSN - 1552-3934
pISSN - 0046-7774
DOI - 10.1177/1077727x8501400117
Subject(s) - reservation , economics , value (mathematics) , purchasing , work (physics) , differential (mechanical device) , microeconomics , variable (mathematics) , labour economics , econometrics , operations management , mathematics , statistics , mechanical engineering , mathematical analysis , aerospace engineering , political science , law , engineering
According to research reported earlier (Zick and Bryant, 1983), estimates of the value of home work time based on the cost of purchasing substitutes in the market are systematically lower than values implied by reservation wages. We argue that much of this differential reflects differences in the tax status of market purchases as compared with the underlying variable captured in the concept of a reservation price. Specifically, market prices are specified on an after‐tax basis; reservation prices are most meaningfully viewed on a pre‐tax basis. Evidence is presented that is consistent with this view.