Individual Consumption, Time Use and their Distribution for the Dutch Population

Abstract

This thesis studies how various types of households (singles and couples, with and without children) decide which goods to buy and how to use their time. Structural models of expenditure and time allocation are used to study poverty (Chapter 2), the effects of a daycare subsidy cut (Chapter 3), and consumption inequality (Chapter 4) in the Netherlands. The models are based on the collective household decision making framework which treats households as a group of individuals deciding collectively rather than a single entity. The thesis shows that decision making power and consumption are not necessarily shared equally in couples, and that couples experience substantial economies of scale in consumption. Chapter 2 studies whether singles and members of couples have the same preferences towards allocating a budget to market goods conditional on gender and other covariates. This equal preferences assumption is rejected. Chapter 2 also addresses how a poverty line for couples can be constructed when there is intra-household inequality. Chapter 3 analyses the effects that the 2010-2013 daycare subsidy cuts have had on daycare use and parental child care hours. The structural model predicts a strong decline in daycare use, but virtually no effect on parental child care hours. Chapter 4 uses a structural model to predict a measure of individual consumption which values the private benefits from market goods, leisure, home production and child care. The measure is comparable across household types. Inequality in individual consumption declined significantly between 2009 and 2017 for working adults in the Netherlands.