The only big example of this phenomenon I can think of is the decline in “home production”; all the household services produced by women throughout history were never counted in GDP, but when they started to become part of market transactions (e.g. buying food from outside rather than cooking at home) they became part of GDP. I am not aware of any estimates of GDP growth valuing home production, though I’m sure someone has done it.
Part of the reason it’s almost pointless to do so is because the quality/nature of a good changes as it moves across the production boundary, to the point where it’s hard to say whether it’s even the same good. For example, is food from a restaurant the same “product” as food you cook at home? It’s probably a different product, with some degree of substitutability with home production.
Part of the reason it’s almost pointless to do so is because the quality/nature of a good changes as it moves across the production boundary, to the point where it’s hard to say whether it’s even the same good. For example, is food from a restaurant the same “product” as food you cook at home? It’s probably a different product, with some degree of substitutability with home production.
and of course, the fact that people voluntarily pay >$5n for a restaurant meal rather than $n for the ingredients even when it saves no time and doesn’t facilitate work is a pretty strong indication that it’s a different product people often significantly prefer.
If we look at other paid substitutes for unpaid household labour, the UK spends less than 1% of GDP on childcare and employs far fewer people cleaning households than it did in the early 20th century, so it’s pretty clear that replacing unpaid labour with paid labour is not a major factor in its economic growth. Most of the additional GDP boost from more women entering the workforce came from them doing higher-value work, not them sometimes paying others to carry out household work they did for free.
Those aggregate figures point towards the answer to the title question being “a rounding-error sized percentage of overall growth”
The only big example of this phenomenon I can think of is the decline in “home production”; all the household services produced by women throughout history were never counted in GDP, but when they started to become part of market transactions (e.g. buying food from outside rather than cooking at home) they became part of GDP. I am not aware of any estimates of GDP growth valuing home production, though I’m sure someone has done it.
Part of the reason it’s almost pointless to do so is because the quality/nature of a good changes as it moves across the production boundary, to the point where it’s hard to say whether it’s even the same good. For example, is food from a restaurant the same “product” as food you cook at home? It’s probably a different product, with some degree of substitutability with home production.
and of course, the fact that people voluntarily pay >$5n for a restaurant meal rather than $n for the ingredients even when it saves no time and doesn’t facilitate work is a pretty strong indication that it’s a different product people often significantly prefer.
If we look at other paid substitutes for unpaid household labour, the UK spends less than 1% of GDP on childcare and employs far fewer people cleaning households than it did in the early 20th century, so it’s pretty clear that replacing unpaid labour with paid labour is not a major factor in its economic growth. Most of the additional GDP boost from more women entering the workforce came from them doing higher-value work, not them sometimes paying others to carry out household work they did for free.
Those aggregate figures point towards the answer to the title question being “a rounding-error sized percentage of overall growth”