Just as with goods and services that entrepreneurs may demand, much of what individuals need can be provided either by the market or within the household. This list of individual demands might include cooking, cleaning, child care and even companionship. Logic suggests that if the costs of using markets are higher than the costs of meeting needs internally, then individuals are more inclined to bring activity in house.
When market and home commodities are relatively good substitutes and when home production is enhanced by forming a household that operates more or less as a team. For instance, single individuals can engage in preparing meals and related activities on their own, but it might be better with a partner. Much research suggests that, on average, people are fairly willing to substitute between market and home goods.