Effects of wage shocks and saving changes on leisure time: The role of dynamic intra-household commitment

Ignacio Belloc, Pierre Chiappori, José Alberto Molina and Jorge Velilla

No 1099, Boston College Working Papers in Economics from Boston College Department of Economics

Abstract: The ability of spouses to commit to future behaviors has important implications for the design of policy interventions targeting specific household members. Using longitudinal data from the Japanese Panel Survey of Consumers (1993-2019), we find robust evidence consistent with limited commitment: positive own past wage shocks increase current leisure, while positive current husband wage shocks reduce the wife’s leisure. Additionally, changes in the wife’s private savings have lasting negative effects on the husband’s leisure time, as limited commitment predicts. These findings extend previous tests of commitment and underscore the importance of accounting for historical changes in the household’s economic environment.

Keywords: dynamic collective model; commitment; leisure; JPSC data (search for similar items in EconPapers)
JEL-codes: D13 D14 H31 J16 J22 J31 (search for similar items in EconPapers)
Date: 2025-10-30
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