Arbeitspapier
Valuing the Time of the Self-Employed
People's value for their own time is a key input in evaluating public policies: evaluations should account for time taken away from work or leisure as a result of policy. Using rich choice data collected from farming households in western Kenya, we show that households exhibit non-transitive preferences consistent with behavioral features such as loss aversion and self-serving bias. As a result, neither market wages nor standard valuation techniques (such as the Becker-DeGroot-Marschak—BDM—mechanism of Becker et al., 1964) correctly measure participants' value of time. Using a structural model, we identify the mix of behavioral features driving our choice data. We find that these features distort choices when exchanging cash either for time or for goods. Our model estimates suggest that valuing the time of the self-employed at 60% of the market wage is a reasonable rule of thumb.
- Language
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Englisch
- Bibliographic citation
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Series: CESifo Working Paper ; No. 9567
- Classification
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Wirtschaft
Field Experiments
Allocative Efficiency; Cost-Benefit Analysis
Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making‡
Time Allocation and Labor Supply
Microeconomic Analyses of Economic Development
Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
- Subject
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value of time
non-transitivity
labor rationing
loss aversion
self-serving bias
- Event
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Geistige Schöpfung
- (who)
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Agness, Daniel
Baseler, Travis
Chassang, Sylvain
Dupas, Pascaline
Snowberg, Erik
- Event
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Veröffentlichung
- (who)
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Center for Economic Studies and ifo Institute (CESifo)
- (where)
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Munich
- (when)
-
2022
- Handle
- Last update
-
10.03.2025, 11:42 AM CET
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Agness, Daniel
- Baseler, Travis
- Chassang, Sylvain
- Dupas, Pascaline
- Snowberg, Erik
- Center for Economic Studies and ifo Institute (CESifo)
Time of origin
- 2022
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