Household Production and Consumption in Finland 2001

2 Definitions and boundaries
Household production
Household production refers to the production of goods and services for the
household’s own use. Examples include preparing meals for oneself or for
family members; the care of clothing; childcare; building or renovating a house
for oneself; and growing berries and vegetables in one’s own garden.
Productive activities are distinguished from leisure or personal activities on
the basis of the third party criterion. This distinction is followed in the
classification for the Harmonised European Time Use Survey (HETUS).
Statistics Finland’s time use data that are used in this Satellite Account follow
this same classification. All activities that come under the heading of domestic
work are productive activities. Studying and other forms of self-development
are excluded from household production, even though they are an investment
in human capital. This is based on the third party criterion: it cannot be
delegated to another person. The same applies to going to the hairdresser,
visiting a doctor and physical fitness exercise, i.e. “investing” in one’s own
physical health. The issues surrounding human capital are an area of study in
its own right, and indeed human capital is singled out in SNA93 as a candidate
for a separate satellite account.
Household
The economic unit in the satellite account is the household. According to
Statistics Finland’s definition, a household is formed by people who live
together and share meals or who otherwise spend their income together. The
national accounts define the household in somewhat more detail as a small
group of persons who share the same living accommodation, who pool some,
or all, of their income and wealth and who consume certain types of goods and
services collectively, mainly housing and food (SNA 1993, 4.132). A person
who lives alone also constitutes a household because that household is a
separate economic unit. In the National accounts, households collectively
make up the household sector. Persons permanently resident in institutions
were excluded from the Satellite Account, even though their households are
included in the household sector.
In the national accounts households have a dual role: all households are
consumers, but some households additionally take part in production. The
latter are either market producers (e.g. farmers, self-employed people) or
own-account producers (goods, housing services produced by
owner-occupiers). In the satellite account household production is extended to
comprise all services produced by households for their own use, and
consequently it could be said that all households are both producers and
consumers.
12 Statistics Finland National Consumer Research Centre