DP12545 | Structural Transformation, Marketization, and Household Production around the World

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We provide evidence on the patterns of household production in 43 developing and developed countries. Household hours account on average for nearly half of the total hours worked in the household and the market. The vast majority of household hours produce services. As GDP per capita increases, average total hours worked and average household hours per working-age population decrease while average market hours increase ("marketization"); hours producing services increase their share in total hours ("structural transformation"). The decrease in household hours is mostly due to changes in housework (cleaning, cooking etc.) and marketization is mostly due to changes in women's hours. Within countries, more educated people work more in the market and less in the household. We also impute the labor productivity of household production for 30 countries of our sample. We find that it is positively correlated with and much lower than that in the market.