The Diseconomies of Do-it-Yourself
I argue that, due to mistrust of markets, households engage in excessive household production and too little market exchange, primarily due to anti-market bias. “Do-It-Yourself,” commonly engaged in for the purposes of prudence, contradicts the concept of comparative advantage under the conditions of perfect markets. Imperfections in real-life markets are insufficient as an explanation for the ubiquity of household production that could plausibly be purchased in markets. The optimality conditions set forth by Becker (1965) are unlikely to hold.
Do-It-Yourself, Behavioral Economics, Social Economics, Rational Irrationality
SMU Cox: Other (Topic)