ABSTRACT
In chapter 6, the theory of labor supply focused on the simple case in which individuals decide how to allocate their time between labor and leisure. This chapter elaborates on this simple labor supply model by taking account of three issues. First, much of the time spent at home is given to work activities (cooking and child care, for example), not leisure. Second, for those who live with partners, decisions about work for pay, household work, and leisure are usually made in a way that takes account of the activities and income of other household members. Third, just as time at paid work is substitutable with time at home, time spent working for pay in one part of the life cycle is substitutable with time later on. These refi nements of our simple model do not alter the fundamental considerations or predictions of labor supply theory, but they do add useful richness to it.
