Outsourcing child care,home cleaning and meal preparation

In this paper, the outsourcing of child care, home cleaning and meal preparation is analysed by means of a socio‐economic model that incorporates household‐economic, life cycle, lifestyle and health variables. The data (n = 700) were collected during a telephone survey in the Netherlands. About 10% of the households did not use any of the three outsourcing types. About 70 to 90% of households outsourced meal preparation at least once per month. In each household life cycle stage, the average monthly expenditures on outsourcing meal preparation were the highest of the three outsourcing categories. Factors affecting expenditures were generally the same for each type of outsourcing studied. In general, household economic variables including wage and working hours were unimportant in explaining the incidence and expenditures of outsourcing. The same holds for self‐reported health. All expenditure types were affected by life cycle variables. There was an indication that a traditional lifestyle and traditional family type affected outsourcing expenditures negatively. Education appeared as an important factor: regardless of gender, both medium‐ and higher‐educated people were more inclined to spend money on outsourcing than the lower educated. Especially, people younger than 44 years outsourced meal preparation. Outsourcing was neither restricted to nor especially practised by couples.     

A new full‐nest classification approach

This study conceptually and empirically develops an improved approach for classifying full‐nest households. Unlike existing life‐cycle models, this study separates traditional full‐nest couples who marry and have children at a young age from those who delay marriage and childbearing until their 30s. Nontraditional delayed full‐nest spouses held nontraditional sex role norms and values and experienced greater work and time pressures. They also consumed more healthy foods and beverages, avoided convenience and junk foods, but consumed more meals prepared away from home, as well as alcoholic beverages, than their traditional counterparts. While extant life‐cycle approaches use age of head of household to separate school‐age and older full‐nest families, this study uses the transitions of the youngest child to school age, and then to teenage years. This distinction more effectively captures life‐style and consumption differences than does the traditional life‐cycle approach. Overall, this new full‐nest classification scheme outperforms existing life‐cycle approaches in identifying unique sex‐role norms and values profiles as well as household food and beverage consumption patterns. It also captures meaningful and significant differences, in dollar values of home entertainment devices and furniture and of major durable assets not uncovered by previous research. Based on these findings, it is recommended that this full‐nest classification approach be incorporated into extant life‐cycle models. © 2002 John Wiley & Sons, Inc.     

The impact of household life‐cycle stages on subjective well‐being: Considering the effect of household expenditures in Hungary

The household life‐cycle stage is a significant contributor to the perception of subjective well‐being; however, the effect of household expenditures of life‐cycles on subjective well‐being has not been thoroughly explored. The life‐course perspective, specifically the study of family/household life‐cycles, emphasizes the understanding of subjective well‐being across the entire life‐span. Accordingly, in the literature subjective well‐being is often studied at different life‐stages considering the influence of variables such as age, cohabitation and fertility. The present study evaluates the level of subjective well‐being across the various life‐cycle stages using a matching method on a Hungarian national sample. This approach is appropriate for studies using observational data because the administration of a true experimental design is usually not feasible for this type of research. The main finding of the article is that controlling for the expenditure structure significantly modifies the effect of life‐cycle on subjective well‐being, which is varied across life‐cycle stages and shown to be highly dependent on household expenditures.     

Child–mother nutrition and health status in rural Kenya: the role of intra‐household resource allocation and education

There exists gender bias in resource ownership in many parts of Kenya with women being more disadvantaged. Resource ownership and control within the household has differential impacts on the health and overall well‐being of male and female members. This paper examines intra‐household resource ownership and how it affects nutrition and health status of household members. Data from a household survey containing detailed gender‐disaggregated information on resource ownership as well as food and anthropometry were collected from a rural Kenyan district and used in the analysis. Results showed that male members of the household had more access to education, income and land than the females. Mothers’ education, household income, frequency of illness and nutrient intake were the most important factors that contributed to the nutritional status of children. The education and household’s economic status were important determinants of child morbidity. Malnutrition and poor health of children and women is linked to the existing poverty in the study region, therefore emphasis needs to be put on eradication of discrimination against women in accessing education and accessing land, which will contribute to an increase in household incomes. Government policies need to focus on promotion of nutrition education through adult education programmes and incorporating it in the school curricula. Improvement of health‐care facilities in rural areas is also paramount to improving health and nutrition in these areas.     

Professional financial advice,self‐control and saving behavior

This study investigates whether professional financial advice (“PFA”) can assist households in making better‐informed financial decisions and whether PFA may help households achieve better self‐control in implementing financial plans. In particular, we examine the effects of PFA and self‐control ability on saving behavior, as well as the interaction of PFA and self‐control on saving behavior. We extend the dual‐self model of impulse control and derive three hypotheses: (a) people with higher levels of self‐control save more than those with lower levels of self‐control; (b) PFA has a positive effect on saving behavior; and (c) people with lower levels of self‐control benefit more from obtaining PFA than those with higher levels of self‐control. We use a German household panel dataset SAVE, which was collected annually from 2005 to 2009. Respondents are asked whether they have discussed financial matters with financial advisors in banks, insurance companies or financial service providers. Using a number of behavioral proxies of self‐control, we create an aggregate measure of self‐control through factor analysis. We estimate a fixed‐effects model to identify the effects of PFA and self‐control on financial assets. Empirical results show that both PFA and self‐control have a significant positive relationship with financial assets. The interaction term of PFA and self‐control is a significant predictor of financial assets. We discuss conclusions for the financial advising industry and public policy aimed at consumer financial literacy.     

Migrants’ Remittances and Financial Development: Macro‐ and Micro‐Level Evidence of a Perverse Relationship

Financial development is commonly identified as an important condition for fostering investment and economic growth. It is also believed that migrants’ remittances stimulate financial development in the receiving economy, contributing indirectly to economic growth. We explore the relationship between remittances and financial development using macro‐ and micro‐level data. From cross‐country panel data, we find evidence of a negative relationship between remittances and financial deepening in developing countries. Using household survey data from a study of migrants’ remittances in two CIS countries, Azerbaijan and Kyrgyzstan, we also investigate the relationship between remittances, financial intermediation and ‘financial literacy’ among remittance‐receiving households. While we find some evidence of a positive, albeit weak, relationship for Kyrgyzstan, in Azerbaijan, the relatively more financially developed economy, we uncover a strong perverse relationship. Remittances appear to deter bank intermediation and use of formal banking services. Possible reasons are explored and areas for further investigation identified.     

Fueling the Credit Crisis: Who Uses Consumer Credit and What Drives Debt Burden?

Excessive household debt contributed to the worst recession in decades. Insights about borrowing and spending behavior can inform economic recovery forecasts, policy decisions, and financial education. This study identifies life cycle and credit attitude as key determinants of who uses debt. Younger households are more likely to borrow for consumption, as are those who believe that it is all right to borrow to purchase luxury goods or cover living expenses. Furthermore, households that condone borrowing for these purposes have a higher consumer debt burden. Debt capacity (or creditworthiness) and financial discipline are also significant factors in determining household debt use.     

Characteristics of food‐wasting consumers in the Czech Republic

This paper investigates food waste at the consumer stage of the food chain. The authors conducted a questionnaire survey with 259 respondents to identify the key characteristics of food‐wasting consumers and to suggest strategies to improve food‐wasting behaviour. The results of the survey confirmed that the rate at which food is wasted depends on the age, economic status and education of the person managing food in a household, on the household's income per person and on total household income. Younger people, students, economically active people and people from higher‐income households (both per household and per person) waste more, while pensioners waste much less than other groups. However, the sex of the food manager is not associated with food waste. These demographic characteristics should be considered when designing consumer education campaigns focussed on changing consumer motivation and behaviour. This paper also recommends other solutions tailored for specific demographic groups: Younger people and students may be influenced by the actions of opinion leaders within social networks, and technical devices enabling better food management could help them reduce waste. Supporting work‐life balance, broadening the network of food delivery services and implementing corporate initiatives that support food waste prevention could help economically active people reduce their food waste. Additionally, offers of ready‐to‐eat food should be expanded for people with higher incomes.     

Debt as a source of financial stress in Australian households

This paper examines the role of demographic, socio‐economic and debt portfolio characteristics as contributors to financial stress in Australian households. The data are drawn from the most recent Household Expenditure Survey and relate to 3268 probability‐weighted households. Financial stress is defined, among other things, in terms of financial reasons for being unable to have a holiday, to have meals with family and friends, to engage in hobbies and other leisure activities, and general money management. Characteristics examined include family structure and composition, source and level of household income, age, gender and marital status, ethnic background, housing value, debt repayment of various types and credit card usage. Binary logit models are used to identify the source and magnitude of factors associated with financial stress. The evidence provided suggests that financial stress is higher in families with more children and those from ethnic minorities, especially when reliant on government pensions and benefits, and lower in families with higher disposable incomes and housing values. There is weak evidence that Australia's historically high levels of household debt cause financial stress.     

Does Payday Lending Hurt Food Security in Low‐Income Households?

During the study period of 2005–2011, household food insecurity rates as well as regulations over payday lending industry increased in the United States. This study evaluates the association between access to payday lending and the risk of food insecurity using cross‐sectional samples of low‐income households from the 2005 to 2011 Food Security Supplements of the Current Population Survey. The study uses county‐level payday lender density, state‐level legislative status, and county border indicators of cross‐state payday access to examine how payday lender availability affects household food insecurity. The findings suggest that access to payday lending, which may be presumed to provide convenient short‐term credit to underserved consumers, increases the likelihood of household food insecurity by 2.8–6.0 percentage points in absolute terms. Furthermore, the county border effect of payday access has become insignificant later in the sample period, the potential reasons for which are discussed.     

Promoting sustainable financial behaviour: implications for education and research

The current financial crisis has clearly shown that national financial health is strongly tied to the household financial well‐being, and that most consumers were not well equipped with knowledge they needed to cope with this crisis. The failure of markets, institutions, businesses and households during the current financial crisis also revealed the serious economic risks posed by widespread unethical and irresponsible behaviour. The focus of this paper is to explore how, through financial education, we can improve the economic performance of individuals in the economy, both for their own well‐being and for the well‐being of society at large. However, for that to happen, the current approach to financial education will have to include the discussion of attitudes, values and beliefs that enable us to make financial decision that promote long‐term security for families and communities. After establishing the importance of financial education, the challenges and opportunities of the current status of financial education, with emphasis on the complexity of human and financial behaviour, are discussed. It, then, argues for the promotion of responsible behaviour by integrating fundamental values in financial education. Discussion of how selected learning theories can be used to develop effective teaching approaches and the implications for future research conclude the paper.     

Effects of a Tax‐Time Savings Intervention on Use of Alternative Financial Services among Lower‐Income Households

Alternative financial services (AFS) such as check cashing and payday loans may help unbanked households meet transaction and credit needs, yet often at a very high price. Saving tax refunds can help low‐ and moderate‐income (LMI) households build emergency savings as a way to reduce dependence on AFS and cope effectively with irregular cash flows and financial shocks. This study examined the impact on AFS use of message‐based interventions encouraging LMI households to save their refunds when they electronically filed their federal income tax returns. We found that 3 out of 18 interventions resulted in statistically significant reductions in credit‐related AFS use with small effect sizes. None of the interventions resulted in reduced transaction‐related AFS use. Other factors—especially prior AFS use and financial shocks—were strong predictors of AFS. Financially vulnerable households may need additional opportunities and protections to reduce dependence on AFS.     

Understanding bottled water consumption in a high‐poverty context: empirical evidence from a small town in Guatemala

This research investigated the determinants of bottled water consumption using household survey data from a small, poor town in Guatemala. Hurdle (two‐part) models were estimated to account for 73.3% of sampled households that did not consume bottled water. Findings indicated that the vast majority of respondents perceived minimal health risks from drinking bottled water. In contrast, few respondents (3.2%) believed that tap water is totally safe to drink. Estimation results indicated that bottled water consumption was positively associated to health risk perceptions, household income, education and market access. Household size had a negative effect on the likelihood of consuming bottled water. However, once the household had decided to consume bottled water, its consumption increased with each additional household member.     

Education and the empowerment of women in household decision‐making in Spain

It was analysed whether investment in the education of both women and men serves to empower wives resulting in more balanced household decisions being taken on matters related to consumption and financial management. They considered that household decision‐making could be made by mainly the wife, mainly the husband or the couple acting jointly. They then applied multinomial probit models to the Spanish Living Conditions Survey of 2010. Results show that, when controlling for demographic, family and labour market characteristics, the level of education of both the husband and wife has a positive effect in terms of a more egalitarian decision‐making process in relation to three areas of expenditure: daily shopping, expensive purchases of consumer durables and significant expenditure on children. However, only women's education has a positive effect on borrowing money and no effect of education is observed with regard to the use of savings. Results are less conclusive for households where decisions are taken primarily by the wife or husband, since men's education increases the role of husbands in the household making‐decision process whereas no effect of wives' education is observed.     

Unequal effects of elders’ health problems on wealth depletion across race and ethnicity

We investigate the impact of health on wealth depletion of African American, Hispanic, and non‐Hispanic white elders. Using the data from 4,464 elderly households that participated in both the 1993 Asset and Health Dynamics of the Oldest Old and the 1998 Health and Retirement Study, we find that health problems contribute to wealth depletion differently across elders in different racial and ethnic groups. We draw policy implications from the findings regarding ways to help consumers protect their financial security from health shocks in later life.     

Association of nutrition concerns and socioeconomic status with exercise habits

The purpose of this study was to examine the association between socio‐economic characteristics and individual health behaviour patterns. Specifically, we looked at how individual demographics (i.e. age, gender, race, marital status, geographic location of households), socio‐economic status (i.e. education, income, children in the households) and respondents’ nutrition concern were related to the major health behaviour (i.e. exercise). Telephone interviews were conducted to collect the data from 2880 US households. A Poisson regression model was estimated to analyse the factors influencing physical exercise habits of adults. Results showed that the key socio‐economic variables influencing the exercise habit of US population were household income, education and family composition. The direct association of nutrition concern with exercise habits implied that health and nutrition programmes should emphasize good eating habit as well as healthy lifestyle.     

Home Equity Use and the Life Cycle Hypothesis

The life cycle hypothesis of consumption assumes the household to take a life-time perspective on all resources available for consumption, and to use the assets accumulated during the life-time to fund later consumption. Typically, households in the middle, high earning years, are able to save; younger and older households borrow or dissave. For many, a large share of accumulated household assets reside in home equity. This paper analyzes the propensity to use home equity to fund current consumption using a logit analysis of homeowners. The results support earlier criticism of the life cycle hypothesis in finding that older households do not rely on dissaving from assets. Older homeowners are less likely to use home equity to fund current consumption than others. Both sociodemographic determinants of life cycle changes as well as income variables are significant determinants of willingness to use home equity. Liquidity considerations appear to be less important.     

The Links between Early‐Life Cognition and Schooling and Late‐Life Financial Knowledge

Using the Wisconsin Longitudinal Study, a sample of Wisconsin high school graduates from the class of 1957, we explore the relationship between late‐life financial knowledge and human capital formed in early life. Specifically, we examine the associations between early‐life cognition and schooling experiences—such as academic performance and coursework—and late‐life financial knowledge. Financial knowledge is measured as individuals' knowledge of their own financial situations, which we argue is a prerequisite for good financial behavior. We find that those with lower early‐life cognitive functioning, especially those without college degrees, have lower levels of financial knowledge in late life. We find more limited evidence for independent associations of academic performance and math course work with late‐life financial knowledge.     

The determinants of households’ repayment difficulties on mortgage loans: evidence from Italian microdata

This article investigates the main determinants of households’ repayment difficulties on mortgage loans in Italy. We contribute to the empirical literature on household financial vulnerability by assessing the joint impact of socio‐demographic factors, loan characteristics and institutional variables on the likelihood of mortgage insolvency and on the intensity of arrears. Using data from the Italian component of the 2008 European Union‐Statistics on Income and Living Conditions (EU‐SILC) survey, we firstly identify which types of households are more vulnerable to unexpected adverse events that may trigger repayment difficulties. Specifically, households whose head is young, unemployed or immigrant show a higher probability of arrears and emerge as those suffering more from the adverse economic conditions connected to the crisis. Moreover, household repayment behaviour is affected by mortgage characteristics and, in particular, having modified contract terms significantly increases current arrears probability. Finally, regional institutional and credit market factors mainly impact on the conditional intensity of arrears. This evidence suggests that, although repayment difficulties mainly arise from a genuine inability to repay, households are less likely to pay on time when institutions are less effective at punishing default, confirming the existence of some strategic behaviour.