Epsilon Archive for Student Projects

Abstract

This thesis investigates how the energy intensity of consumption is affected by an increase in non-work time by estimating how retirement affects the consumption of gasoline and air travel. An estimable model is derived from Becker's (1965) theory of time allocation which is then estimated for a sample of 58-68 year old full-time workers and retired individuals that is taken from the 2014 Consumer Expenditure Survey made by the Bureau of Labor Statistics. Together with the estimation of a secondary model, it is found that retirement increases total energy intensity of consumption through an increase in airfare expenditure together with a slight decrease in gasoline expenditure. A simple test for extrapolation further suggests that extrapolation of the results for the whole working population might be possible.