Measuring Trends in Leisure

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MEASURING TRENDS IN LEISURE: THE ALLOCATION OF TIME OVER FIVE DECADES

Mark Aguiar Erik Hurst Working Paper 12082 http://www.nber.org/papers/w12082 NATIONAL BUREAU OF ECONOMIC RESEARCH 1050 Massachusetts Avenue Cambridge, MA 02138 March 2006

We thank Susanto Basu, Gary Becker, Kathy Bradbury, Kerwin Charles, Raj Chetty, Steve Davis, Jordi Galí, Rueben Gronau, Dan Hamermesh, Chad Jones, Ellen McGrattan, Bruce Mayer, Kevin Murphy, Derek Neal, Valerie Ramey, Richard Rogerson, Frank Stafford, and seminar participants at the Minneapolis Federal Reserve, the Cleveland Federal Reserve (NBER EFG/RSW meeting), the University of Rochester, the University of Wisconsin’s Institute for Poverty Research Summer Institute, NBER Summer Institute in Labor Studies, the University of California at San Diego, the University of California at Berkeley, the University of Chicago, Columbia University, Boston College, Harvard, Wharton, and the University of Maryland. We thank Dan Reichgott for research assistance. Hurst would like to acknowledge the financial support of the University of Chicago’s Graduate School of Business. The views expressed in this paper are solely those of the authors and do not reflect official positions of the Federal Reserve Bank of Boston or the Federal Reserve System. The views expressed herein are those of the author(s) and do not necessarily reflect the views of the National Bureau of Economic Research. ©2006 by Mark Aguiar and Erik Hurst. All rights reserved. Short sections of text, not to exceed two paragraphs, may be quoted without explicit permission provided that full credit, including © notice, is given to the source.

Measuring Trends in Leisure: The Allocation of Time Over Five Decades Mark Aguiar and Erik Hurst NBER Working Paper No. 12082 March 2006 JEL No. D12, D13, J22 ABSTRACT In this paper, we use five decades of time-use surveys to document trends in the allocation of time. We find that a dramatic increase in leisure time lies behind the relatively stable number of market hours worked (per working-age adult) between 1965 and 2003. Specifically, we show that leisure for men increased by 6-8 hours per week (driven by a decline in market work hours) and for women by 4-8 hours per week (driven by a decline in home production work hours). This increase in leisure corresponds to roughly an additional 5 to 10 weeks of vacation per year, assuming a 40-hour work week. Alternatively, the "consumption equivalent" of the increase in leisure is valued at 8 to 9 percent of total 2003 U.S. consumption expenditures. We also find that leisure increased during the last 40 years for a number of sub-samples of the population, with less-educated adults experiencing the largest increases. Lastly, we document a growing "inequality" in leisure that is the mirror image of the growing inequality of wages and expenditures, making welfare calculation based solely on the latter series incomplete. Mark Aguiar Federal Reserve Bank of Boston 600 Atlantic Avenue Boston, MA 02210 mark.aguiar@bos.frb.org Erik Hurst Graduate School of Business University of Chicago Hyde Park Center Chicago, IL 60637 and NBER erik.hurst@gsb.uchicago.edu

1.

Introduction
In this paper, we document trends in the allocation of time over the last 40 years. In

particular, we focus our attention on measuring how leisure time has evolved within the United States. In commonly used household surveys designed to measure labor market activity (such as the Current Population Survey (CPS) and the Panel Study of Income Dynamics (PSID)), the only category of time use that is consistently measured is market work hours.1 As a result, leisure is almost universally defined as time spent away from market work. However, as noted by Becker (1965), households can also allocate time towards production outside the formal market sector. To the extent that non-market (home) production is important and changing over time, leisure time will be poorly proxied by time...
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