Consumer Expenditures and Home Production at Retirement - New Evidence from Germany

Lührmann, Melanie

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URL:	https://ub-madoc.bib.uni-mannheim.de/1566
URN:	urn:nbn:de:bsz:180-madoc-15666
Document Type:	Working paper
Year of publication:	2007
The title of a journal, publication series:	MEA Discussion Papers
Volume:	120
Place of publication:	Mannheim
Publication language:	English
Institution:	School of Law and Economics > Sonstige - Fakultät für Rechtswissenschaft und Volkswirtschaftslehre
MADOC publication series:	Veröffentlichungen des MEA (Mannheim Research Institute For the Economics of Aging) > MEA Discussion Papers
Subject:	300 Social sciences, sociology, anthropology
Classification:	JEL: D12 D13 D91 J26 ,
Subject headings (SWD):	Verbraucherverhalten , Haushaltsproduktion , Altersgrenze , Lebensdauer , Zeitbudgetforschung , Deutschland
Keywords (English):	Consumer Demand , Time Use , Retirement , Life Cycle Model
Abstract:	This paper investigates consumer expenditures of German households pre- and post-retirement. The widely observed distinct drop in spending upon retirement entry poses an empirical puzzle since life cycle theory predicts smoothing of the marginal utility of consumption over time. As one explanation, I explore the role of home production as a substitute for consumer expenses. Taking a combined look at consumer expenditures and time use pre and post-retirement, I find a significant drop of about 17% of pre-retirement expenses at retirement which coincides with an increase in time spent on home production of an additional 33% per day.
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