Capital—Labor Substitution in the Home

Abstract

Capital—Labor Substitution in the Home T A N I S DAY The household has always used female labor in the production of goods and services it consumes and uses, but during the 20th century the market for female labor changed considerably. As the market demand for female labor rose, the market wage rose too. In the household this simultaneously increased the price of labor in homes that could afford domestic servants and increased the implicit cost of housewives’ own time. These effects together created an incentive to increase the productivity of labor used in the home. When a new technology is added to a production process for use by labor, the laborer is able to produce more output for each unit of effort. This raises the measurable productivity of labor. By increas­ ing the level of technology used in the home, the increasingly scarce and expensive female labor could produce more output. Hence there was an incentive in any household production process to shift toward capital. Simultaneously during the 20th century, there was a burgeoning of small capital-goods industries as the North American market econ­ omy grew. This was the era of mechanization and electrification, when production processes originally done by hand were changed to make use of capital goods. Domestic goods increased in complexity and capability over many decades, which caused a continuous adjustment in the production processes in the home. Not only were the relative prices and productivities of labor and capital changing, but real incomes were rising too. This increased each household’s ability to acquire the new goods. The shift to increased capital usage was a response to changing economic conditions of relative prices and income constraints within the home. Dr. Day teaches in the Department of Economics, Queen’s University. Early versions of this article were presented at a number ofconferences and seminars, including those of the Canadian Economics Association and the thirteenth Conference on the Use of Quantitative Methods in Economic History. The author is grateful to all participants for useful comments and discussion and also wishes to thank two T&C reviewers for their very helpful comments.© 1992 by the Society for the History of Technology. All rights reserved. 0040- 165X/92/3302-0007$01.00 302 Capital—Labor Substitution in the Home 303 Changes in domestic capital usage have been examined by sociolo­ gists and historians.1 They have not been given much attention by economists, although the school of economics called the new house­ hold economics has considered the existence and importance of capital usage in the home.2 Gary Becker specifically discussed the substitution of capital for labor in production processes. Richard Muth demonstrated that the demand for household capital goods is actually a demand for production goods. Nevertheless, most econo­ mists continue to treat household capital goods as consumption goods with tastes dominating the decision to purchase. Little economic work has been done on the diffusion of household capital and the economic factors affecting the diffusion.3 Before it is possible to understand women’s labor-force behavior, we need to understand women within their own homes. In examining the increase of married women in the labor force over the 20th 'See, e.g., William D. Andrews and Deborah C. Andrews, “Technology and the Housewife in Nineteenth-Century America,” Women’s Studies 2 (1974): 309-28; Meg Luxton, More than a Labour of Love: Three Generations of Women's Work in the Home (Toronto, 1980); Ann Oakley, Women's Work: The Housewife Past and Present (New York, 1974); Alison Ravetz, “Modern Technology and an Ancient Occupation: Housework in Present-Day Society,” Technology and Culture 6 (1965): 256-60; J. P. Robinson, “House­ work Technology and Household Work,” in Women and Household Labor, ed. S. Berk (Beverly Hills, Calif., 1980); Ruth Schwartz Cowan, “The ‘Industrial Revolution’ in the Home: Household Technology and Social Change in the 20th Century,” Technology and Culture 17 (1976): 1—23, and More Work for Mother: The Ironies of Household Technology from the Open Hearth to the Microwave (New York, 1983); Susan Strasser, “An Enlarged Human Existence? Technology and Household Work in 19th Century America,” in Women and Household Labor, ed. S. Berk (Beverly Hills, Calif...