SFB 303 Discussion Paper No. A - 586
Author: Jang, I.
Title: Nonparametric Analysis of Cross Section Labor Supply Curves
Abstract: This paper studies the cross section labor supply curves of six different
groups of workers - single male and female, married couple with nonworking
spouse, and married couple with working spouse - using 1991 U.S. Consumer
Expenditure Survey. Most existing empirical studies assume a simple linear
functional form that does not allow the possibility of backward bending
behavior for the sake of convenience in modelling. Multivariate local linear
regression adopted in this paper shows significant nonlinearities
and backward bending behavior of labor supply curve with respect to wage. This
might be interpreted as an evidence against the possibility of
exact aggregation of individual labor supply curves. Besides, it
also shows that the elasticity measures of the parametric
functions can be quite misleading.
Keywords: Labor Supply Curve, Multivariate Local Linear Regression,
JEL-Classification-Number: C14, C21, J22
Creation-Date: November 1998
Unfortunately this paper is not available. Please order a hardcopy via e-mail.
SFB 303 Homepage