We develop a model of the household that includes pets. We use over twenty years of data from the Consumer Expenditure Survey to consider pet ownership and expenditures for single and married households. Households with very young children are less likely to own pets and have lower pet expenditures, showing a substitute relationship. Households with older children are more likely to own pets, suggesting a complementary relationship. However, households with more children show reduced pet spending, evidence of a substitute relationship. Surprisingly, when the effect of income on pet ownership and pet spending are jointly considered in computing the income elasticities, women in married households have smaller income elasticities for pet expenditures than do men. This finding is the opposite of what has been found for women and men with regard to expenditures on children.

Peak-time rebates offer an opportunity to introduce demand response in electricity markets. To implement peak-time rebates, utilities must accurately determine the consumption level if the program were not in effect. Reliable calculations of customer baseline load elude utilities and independent system operators, due to factors that include heterogeneous demands and random variations. Prevailing research is limited for residential markets, which are growing rapidly with the presence of load aggregators and the availability of smart grid systems. Our research pioneers a novel method that clusters customers according to the size and predictability of their demands, substantially improving existing customer baseline calculations and other clustering methods.