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PART B (60%)
QUESTION 3
a)
Step 1: Becker model and Simple work-leisure choice model both explain that how
the allocation of time between work and leisure is done. Becker model is the
extension of Simple work-leisure choice
Step 2: The difference between Becker model and Simple work-leisure choice model is that
in the Simple model the allocation of time between work and leisure is decided by
an individual and in Becker model it is decided by the household and uses of time in
Backer model are more complex than Simple work-leisure choice model.
Becker model is based on household perspective and Simple work-leisure choice
model is based on individual perspective.
According to Becker individual decisions depends upon the other family members of
the household so he focus on household perspective rather on individual
perspective. Becker model allows household for multiple uses of time. He used
more complex categorization of the uses of time than Simple work-leisure choice
model.
Step 3: According to Becker model there are three uses of time given below:
1. Time for labor market –this time is used to generate income and acquire
market goods.
2. Household production of time
3. Consumption time.
Baker model there are two types of characteristics of commodity
One is time incentive commodity and another is good intensive commodity. Time
intensive commodities are those commodities which use large amount of time and
a small amount of goods like watching sunsets. Goods-intensive commodities are
those commodity which uses small amount of time and a large amount of goods
