A new look at the value of leisure in two-worker households

We depart from the individual view behind those time allocation models aimed at the calculation of the value of leisure (VoL) when dealing with two-worker households, as this (prevailing) view requires approximations and assumptions that do not hold well. As the existing theories that consider the household deals with time allocation but not with time values, we propose an integration of some elements of both theories, generating a model with a collective view from which the VoL can be obtained. We argue theoretically that this model yields larger VoL and contains elements that should diminish the possible gap in VoL between the workers. The improved model is applied using Chilean data verifying its theoretical properties at various levels and correcting counterintuitive results obtained with the individual model.