Economic Theory

, Volume 6, Issue 1, pp 179–193 | Cite as

Estimating substitution elasticities in household production models

  • Peter Rupert
  • Richard Rogerson
  • Randall Wright


Dynamic general equilibrium models that include explicit household production sectors provide a useful framework within which to analyze a variety of macroeconomic issues. However, some implications of these models depend critically on parameters, including the elasticity of substitution between market and home consumption goods, about which there is little information in the literature. Using the PSID, we estimate these parameters for single males, single females, and married couples. At least for single females and married couples, the results indicate a high enough substitution elasticity that including home production will make a significant difference in applied general equilibrium theory.


Equilibrium Model General Equilibrium Production Model Married Couple Production Sector 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.


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Copyright information

© Springer-Verlag 1995

Authors and Affiliations

  • Peter Rupert
    • 1
  • Richard Rogerson
    • 2
    • 3
  • Randall Wright
    • 4
    • 3
  1. 1.Federal Reserve Bank of ClevelandClevelandUSA
  2. 2.Department of EconomicsUniversity of MinnesotaMinneapolisUSA
  3. 3.Federal Reserve Bank of MinneapolisUSA
  4. 4.Department of EconomicsUniversity of PennsylvaniaPhiladelphiaUSA

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