A Matter of Quality? Experimental Evidence on Preferences and Willingness to Pay for Domestic Services

Natascha Nisic (), Friederike Molitor () and Miriam Trübner ()
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Natascha Nisic: Johannes Gutenberg University Mainz
Friederike Molitor: Johannes Gutenberg University Mainz
Miriam Trübner: Johannes Gutenberg University Mainz

No 2209, Working Papers from Gutenberg School of Management and Economics, Johannes Gutenberg-Universität Mainz

Abstract: Despite a growing need for domestic help, many households refrain from outsourcing their domestic chores to the market. By drawing on transaction cost theory, the present study sheds light on how demand can be stimulated by overcoming trust problems that are related to the quality and professionalisation of domestic services. The experimental findings from our factorial survey (N=4024) further show how state-subsidised service vouchers not only facilitate outsourcing by alleviating budget constraints, but also how they contribute to better pay for domestic workers while simultaneously reducing the costs for households. Overall, the results support recent policy recommendations that emphasise the role of professionalisation, in combination with service voucher systems, in increasingly shifting paid domestic work from the informal to the formal economy.

Pages: 34 pages
Date: 2022-10-10
New Economics Papers: this item is included in nep-dcm, nep-exp and nep-iue
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Persistent link: https://EconPapers.repec.org/RePEc:jgu:wpaper:2209

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