Household Production and the Household strongEconomystrong.pdfVIP

1 The University of Melbourne DEPARTMENT OF ECONOMICS Research Paper Household Production and the Household Economy* By Duncan Ironmonger Director Households Research Unit Department of Economics University of Melbourne PARKVILLE 3010 Tel: + 61 3 8344 0806 Fax: +61 3 9349 4291 Duncan@ariel.unimelb.edu.au 2 * A shorter version of this paper is to appear as an entry, titled Household Production, in the International Encyclopedia of the Social Behavioral Sciences, Elsevier Science (2001). 3 Household Production Household production is the production of goods and services by the members of a household, for their own consumption, using their own capital and their own unpaid labor. Goods and services produced by households for their own use include accommodation, meals, clean clothes, and child care. The process of household production involves the transformation of purchased intermediate commodities (for example, supermarket groceries and power-utility electricity) intofinal consumption commodities (meals and clean clothes). Households use their own capital (kitchen equipment, tables and chairs, kitchen and dining room space) and their own labor (hours spent in shopping, cooking, laundry and ironing). The total economic value added by households in household production has been aptly n