We propose a collective labor supply model with household production that generalizes a model of Blundell, Chiappori, and Meghir (2005). Adults' preferences depend not only on own leisure and individual private consumption of market goods. They also depend on the consumption of domestic goods, which are produced by combining market goods with individuals' time. A new identification result, which uses production shifters, is developed. We apply our model to unique data on Dutch couples with children. Our application uses a novel estimation strategy that builds upon the familiar two-stage allocation representation of the collective model.
Cherchye, L. J. H., de Rock, B., & Vermeulen, F. M. P. (2012). Married with children: A collective labor supply model with detailed time use and intrahousehold expenditure information. American Economic Review, 102(7), 3377-3405. https://doi.org/10.1257/aer.102.7.3377