The Benefits of Free Trade to U.S. Consumers

Much of the literature concerning trade liberalization focuses on estimating the effect of increased trade on aggregate economic indicators, such as the growth in GDP per capita. Although there is a general recognition that trade benefits consumers, there is little research that estimates the direct impact of increased trade on U.S. consumers. We take broad measures of the economic impact of trade liberalization from three authoritative studies and apply economic principles to estimate the impact of increased trade on the income of U.S. households. We find, for example, that U.S. households gained about $2,500 in 2002 from increased trade, or the equivalent of almost six percent of the median household income in that year. We believe these results should be given weight in the ongoing debate regarding the effect of globalization.JEL Classification F130,F140     

Presence of children and household food expenditures at home and away from home

Households with children spend more on food at home than do households without children. On the other hand, compared with households without children, households with children who are at least 12 years of age are associated with higher expenditures on food away from home expenditures. Households with employed spouses are associated with lower expenditures on food at home. Other determinants of expenditures on food at home are seasonality, house ownership, region, household size, education, age and income. House ownership, region, household size, race, education and income also affect expenditures on food away from home.     

Home-based entrepreneurship and multiple roles—an inter-role conflict

Home-based entrepreneurship has been identified as an alternative source of employment and income for residents of non-metropolitan communities. Although economic and social advantages of home-based work have been identified, negative factors associated with home-based entrepreneurship have also been reported Home-based entrepreneurs may experience inter-role conflict as a result of an overlapping of roles (i.e. work/family) within the environs of the home. Findings from interviews with home-based entrepreneurs are discussed in relation to the multiplicity of roles of the home-based entrepreneur. Further, implications are addressed concerning the conflicts arising from multiple role demand as a home-based entrepreneur.     

Comprehensive Homeowners Microinsurance in Brazil: Estimation of Pricing and Market Potential

This study examines the question of comprehensive microinsurance for Brazilian homeowners. In particular, the study calculates (i) pricing for selected types of microinsurance homeowner's coverages and insured amounts and (ii) the estimated market potential of this product. The Brazilian agency charged with responsibility for regulation of private insurance, SUSEP, has determined that microinsurance should be aimed at families with a monthly per capita income of up to two minimum wages. According to this criterion, the study finds that there are more than 42 million households in Brazil eligible for microinsurance. The study also finds that microinsurance premiums for these households would be very low (US $0.97 to 2.03 per month)—less than 1% of average household income. This type of insurance would certainly be viable, considering the calculated market size of approximately US $780 million per year. These figures show that there is significant potential for the expansion of the microinsurance market in Brazil.     

Transiting to Work: The Role of Private Transportation for Low‐Income Households

This study examines the role of reliable vehicles in facilitating employment, using a new data set, the Iowa Transportation and Employment Survey. The empirical results document significantly higher levels of transportation problems and human capital barriers among low‐income households compared to other households and among low‐income nonworking adults compared to their employed counterparts. The multivariate analysis of low‐income households shows that employment and reliable transportation are related. Respondents without access to a reliable vehicle are less likely to be employed; those employed are more likely to have access to a reliable vehicle. Residence in an area adjacent to a metropolitan area has a positive effect on working.     

Reformbedarf bei der steuerlichen Berücksichtigung von Kinderbetreuungskosten

In Germany, parents’ taxable income base is reduced by the costs of childcare. The way this is done at the moment is not suitable: for some parents, the income tax deduction is too high, while for others it is too low. The actual tax regulations concerning childcare costs do not support the ability-to-pay principle. This paper discusses how the costs of children and childcare should be treated for tax purposes and which reforms would improve the fairness of the tax treatment of taxpayers with children compared to the tax treatment of taxpayers without children.     

Homeownership among Young Americans: A Look at Student Loan Debt and Behavioral Factors

This study uses the National Longitudinal Survey of Youth (1997) to examine the factors that impact homeownership among young adults, with an emphasis on student loan debt. Three key findings arise from the research. First, life cycle and demographic characteristics, such as marital status, education, and income, continue to be strong predictors of homeownership. Married households with a college degree and children are among the most likely to own a home. Second, young adults with student loan debt are no more or less likely to own a home than someone without debt after controlling for a number of factors; however, students who have already paid off their loans are more likely to own a home. Finally, respondents who express a willingness to take risks in finances are more likely to own a home while those who are more conscientious are less likely to own a home.     

A situational analysis of consumer science skills used to improve incomes and create self‐employment in the Limpopo province,South Africa

A two‐phase study was conducted in the Mopani and Vhembe Districts of the Limpopo Province of South Africa to identify types of small‐scale businesses used by households to improve their income. The study sample was made up of 240 households from 16 villages and members from 16 organizations working with households in small‐scale, business‐related activities. Phase one of the study collected data on the types of small‐scale businesses carried out by households and organizations assisting them. Phase two developed training manuals and offered training to households. The findings revealed that self‐employment from sales of prepared and processed foods provided the main source of income for most households. Clothing and needlework and housing and art/craft were also used by families to generate income. Problems experienced included lack of technical/management skills, lack of marketing/business skills, inadequate operational funds, low profit margins, unavailability of raw materials and competition from big businesses. The findings highlighted the importance of consumer science‐related skills in poverty alleviation programmes targeting low‐resource households.     

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.     

Consumer laundry practices in Germany

Sustainability is a guiding principle for a responsible, future‐oriented 21st century lifestyle and this already begins in private households with the daily household tasks. Approximately 25% of an average household's electricity consumption is required to do the laundry and dishwashing – 5% alone is for washing clothes with a corresponding energy consumption of 6 billion kilowatt hours. In addition, 600 000 tonnes of detergent and 330 million cubic metres of water are used for textile care in Germany. These figures provide the rationale for the scientific study of current practices of using washing machines and for a resulting estimate of the latent energy‐saving potential in German households. In the context of the in‐home study presented here, 236 private households throughout Germany were studied with respect to their washing practices and existing knowledge about topics on the sustainable, energy‐saving use of their washing machines. Overall, across all households 2867 wash cycles were individually recorded and subsequently analysed over a 4‐week period. The results of this study show that washing machines tend to be underloaded, and therefore maximum loading of the machines could lead to a reduction of wash cycles per household. With respect to detergent dosage, it was determined that the consumer does not adjust the dosage to the textile type, load size, soil level and/or water hardness, and this can lead to under‐ or overdosing depending on prevailing conditions. Finally, the selection of the wash temperature showed a 90°C/95°C programme was only chosen in 2.3% of all recorded wash cycles, however, every fourth cycle was completed at 60°C. Therefore, adjusting the load size and detergent dosage as well as selecting the right wash temperature are key themes to be taken into account in future consumer communication about energy‐saving households.     

Children's participation in household tasks as portrayed by national television advertisements in the U.S.A.

This paper provides a content analysis of portrayals of children's participation in household tasks in national television advertisements within the U.S.A. The analysis indicates that children are rarely shown working in the home, even when they could help. Furthermore, parents are shown routinely performing tasks children could have done for themselves. The resulting stereotypes are clearly drawn: children are shown to be non-productive and parents are portrayed as servants. Such portrayals may be counter-productive in the context of growing time pressures in the household and the potential benefits that families might realize by working together towards common goals.     

Resource use: the complexity of time and energy management in clothing maintenance

The research study examined time management and energy consumption with respect to clothing care. The investigation analysed data and information obtained in the NE-113 Family Time-Use Study collected in 1977–1978. Differences were found between urban and rural households and among different states. Occupational types of home manager, day of the week, education and age of children were variables accounting for differences in clothing care activities. The results have significance for a better understanding of how modem households meet the demands of clothing care management.     

The Role of Refund Expectations in Savings: Evidence from Volunteer Income Tax Preparation Programs in the United States

Millions of households in the United States receive federal income tax refunds annually, many for substantial amounts. Consumers can use the proceeds of income tax refunds for spending and saving, but tests of prior programs to encourage savings show low take‐up rates. This field study shows that the majority of tax filers make no estimate of their refund amount in advance, but that consumers who are able to estimate their refund in advance of completing their tax returns tend to be reasonably accurate in their estimates. Moreover, taxpayers who estimate their refunds before filing their taxes are more likely to save their refunds than those who do not. These results highlight the importance of expectations and planning with respect to savings decisions.     

Impact of wife's employment on service expenditures

Data from the 1986 Consumer Expenditure Survey were used to examine the relationship between wife's employment and spending on services that are expected to be sensitive to the value of time. Tobit regression analysis indicated that wife's employment status was influential in explaining expenditure on food away from home, child care and total services only. Other independent variables, such as income, education and age. were more influential in explaining expenditure than was wife's employment status.     

Analysis of away-from-home and at-home calcium intake in the United States

Americans consume calcium considerably below the recommended daily allowance. This paper examines the impact of socioeconomic and demographic factors on individual intake of calcium from the away-from-home and at-home markets. Results generally imply that older, hispanic, and black females, from larger and lower income households, who are food stamp recipients, and from the West, have lower average daily calcium intake away from home than others. On the other hand; older, taller, employed, hispanic, non-white females from smaller and higher income households in the South have lower average daily calcium intake at home than others.     

Spending patterns of lone-parent and two-parent Canadian families

Data on 214 lone-parent families and 1,133 two-parent families were drawn from the Canadian 1990 Survey of Family Expenditures to examine their expenditure patterns. Tobit analysis was used to estimate marginal propensities to consume and income elasticities of 14 expenditure categories. Statistically significant differences between lone-parent families and two-parent families were found for the marginal propensities to consume and the income elasticities for expenditures on food at home, household operations and personal care.     

PRODUCTIVE TIME OF HOUSEHOLD HEADS

This study is an analysis of the utility value of time. Time is viewed on a productivity continuum with activities that result in measurable products such as income or home sewing at one extreme of the continuum and activities such as sleep at the other extreme. The use of time by unemployed and employed heads of households was the basis for this analysis. Four measures of time were constructed to determine the amount of time spent in market, household, leisure and personal activities. Unemployed heads of households spent more time in household and leisure activities than employed heads. Assuming that household activities have productive value, time spent in child care, shopping, house cleaning, etc., were viewed as having utility value for the household. Thus, reallocated time had utility value for the household. In addition, it was found that a significant relationship existed between employment status and use of time, regardless of position on the productivity continuum. From this study comes a better understanding of how time is reallocated during unemployment so that the economic loss for the household as well as the economy can be minimized.     

The effect of phosphate detergent bans on consumer clothing expenditures

Metropolitan sales data from the 1977 Census of Retail Trade were analysed to test whether phosphate detergent bans increased consumer expenditure on clothing: positive effects were found for men's clothing and domestic fabrics (sheets and towels). In areas with medium water hardness the average annual cost in 1977 equalled $11·08 per household. For 1984, the equivalent cost was $14·17 per household. These results are consistent with laboratory studies that show decreased detergency associated with non-phosphate detergents and increased fabric wear associated with carbonate-built detergents, the principle substitute for phosphate detergents. The bans impose the largest cost on hard water areas. In both ban and non-ban areas in 1977 higher laundering costs were associated with higher water hardness. Analysis of 1972 data indicated that water hardness did not affect clothing expenditures significantly when detergents contained large amounts of phosphates.     

Implicit Tax Rates of the Expanded Earned Income Tax Credit for Welfare Recipients in North Carolina

High implicit tax rates for welfare recipients have been cited as a deterrent to additional work effort by these households. The expanded earned income tax credit (EITC), passed by Congress in 1993, was enacted in part to reduce the implicit tax rates and increase work effort by very low income households. This paper calculates implicit tax rates for a typical welfare family in North Carolina before and after the expanded EITC. Although the expanded EITC reduces implicit tax rates for the typical welfare household at very low levels of earnings, implicit tax rates are still found to be substantial, especially when work and child care costs are included.     

Self-Employment Matching: An Analysis of Dual Earner Couples and Working Households

This paper explores the significance of intra-couple and intra-household influences on self-employment. It may be the case that employment type matching is prevalent whereby individuals within a couple or household are characterised by similar types of employment. Alternatively, an individual may pool income risk with his/her partner by holding a diversified portfolio of employment types within the household thereby introducing an element of intra-household risk pooling. Such an arrangement may be particularly appropriate if one member of the couple is self-employed. We utilise ordered probit and random effects ordered probit analysis to explore the prevalence of employment matching and/or risk pooling within couples or households. Our empirical analysis which is based on cross-section data drawn from the British Family Expenditure Surveys 1996 to 2000 provides evidence of employment type matching both within dual earner couples and, to a lesser extent, in the wider context of working household members.