Estimation of a Dynamic Model of Labor Supply PDF Download

Author: Robert F. Cotterman
Publisher:
ISBN:
Category : Labor supply
Languages : en
Pages : 75

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Author: Seung Chan Ahn
Publisher:
ISBN:
Category : Labor contract
Languages : en
Pages : 338

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Author: François Poinas
Publisher:
ISBN:
Category :
Languages : en
Pages : 0

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This thesis contains three essays in microeconometrics and applied labor economics. In the first two essays, we estimate dynamic models of schooling choices and employment contract outcomes of the French population. The first essay focuses on the comparison between second-generation immigrants from Africa and their French-natives counterparts. We show that the gap in higher education attainments between those two sub-populations is mainly explained by parents' background and that schooling investment is the main determinant of the gap in permanent employment. The second essay investigates the role played by educational attainments on the employment contract transitions in the early career. We find that a first fixed term contract has a positive impact on the probability of employment in a permanent contract, except for a limited set of the population endowed with particular schooling attainments and unobserved characteristics. Globally, schooling attainments account for around one third of the variance in the probability of permanent employment. The third essay is devoted to the analysis of intra-firm promotions of American executives. We estimate a dynamic model of promotions, in which we disentangle the spurious and the causal impacts of the speed of past advancement. We find that the principal determinant of promotions is unobserved heterogeneity and that the speed of past advancement in the firm's hierarchy (fast tracks) does not have a causal impact on promotions. Functional area has a high explanatory power in promotion outcomes.

Author: Emmanuel Skoufias
Publisher:
ISBN:
Category : Agricultural laborers
Languages : en
Pages : 35

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Author: Lee A. Lillard
Publisher:
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Category :
Languages : en
Pages :

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The purpose of this paper is to develop and test a dynamic labor supply model which incorporates the essential features of these previous models. The issues of permanent and transitory effects and of cross section versus time series can be addressed much more directly given the recent availability of panel data featuring repeated observation over extended periods of time of the same individuals. The labor supply model presented emphasizes the effect of permanent individual wage differences on permanent annual hours of work and the effect of serially correlated transitory individual wage variation on short run hours of work. Permanent and transitory deviations from the aggregate labor supply functions are also allowed. A by-product is an analysis of the relative roles of permanent and transitory components of both wages and hours in the distribution of earnings. The first section introduces the topic and describes related works. The second section provides a description of the essential features of the model. Section III provides a detailed outline of the empirical model and method of obtaining maximum likelihood estimates of parameters. Section IV provides a discussion of the results including the components of variation in wages, hours, and earnings. Comparisons are made by schooling group, by experience group, by union status, and by wife's work status. Finally the results are summarized in Section V

Author: Thomas Coleman
Publisher:
ISBN:
Category :
Languages : en
Pages : 49

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This paper develops an multi-state optimizing model of individual labor supply that concentrates on all-or-nothing employment decisions. This model views individual behavior in the labor market as a process of moving between labor force activities (employed, unemployed, and not-in-the-labor-force). Agents are in a stochastic environment and make decisions whether they want to work or not. When an agent decides they want to work, however, they must search for a job. Jobs at the going wage cannot be found immediately, and an agent must spend time and (possibly) money looking for a firm with an available job. The probability of finding an available job in the next instant, if less than unity, acts as a constraint on labor supply; a worker would work at the current wage but is unable to do so because jobs are not instantaneously available. This is a formal model of frictional unemployment, although one could also label such unemployment involuntary. This model is closely related to the analysis of the duration of unemployment. (See, e.g. Kaitz, 1970; Salant, 1977; Nickell, 1979; Heckman and Singer, 1984a, 1984b.) Other models that deal with employment versus non-employment decisions are Lippman and McCall (1976); Toikka (1976); Burdett and Mortensen (1978a, 1978b).

Author: Alan Manning
Publisher: Princeton University Press
ISBN: 1400850673
Category : Business & Economics
Languages : en
Pages : 414

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What happens if an employer cuts wages by one cent? Much of labor economics is built on the assumption that all the workers will quit immediately. Here, Alan Manning mounts a systematic challenge to the standard model of perfect competition. Monopsony in Motion stands apart by analyzing labor markets from the real-world perspective that employers have significant market (or monopsony) power over their workers. Arguing that this power derives from frictions in the labor market that make it time-consuming and costly for workers to change jobs, Manning re-examines much of labor economics based on this alternative and equally plausible assumption. The book addresses the theoretical implications of monopsony and presents a wealth of empirical evidence. Our understanding of the distribution of wages, unemployment, and human capital can all be improved by recognizing that employers have some monopsony power over their workers. Also considered are policy issues including the minimum wage, equal pay legislation, and caps on working hours. In a monopsonistic labor market, concludes Manning, the "free" market can no longer be sustained as an ideal and labor economists need to be more open-minded in their evaluation of labor market policies. Monopsony in Motion will represent for some a new fundamental text in the advanced study of labor economics, and for others, an invaluable alternative perspective that henceforth must be taken into account in any serious consideration of the subject.

Author: Lee A. Lillard
Publisher:
ISBN:
Category : Labor supply
Languages : en
Pages : 32

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Author: Michael C. Keeley
Publisher:
ISBN:
Category : Denver
Languages : en
Pages : 114

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Author:
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Category :
Languages : en
Pages : 0

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This dissertation contains three separate essays on the dynamic models of labor supply and retirement. The first essay documents "sharp retirement"--Retirement accompanied by a discontinuous decline in labor supply--across three data sets, which previous literature found difficult to explain. I propose and estimate a life-cycle labor supply model with habit persistence wherein sharp retirement can be explained by workers quitting "cold turkey." The working habit model is consistent with the data, where workers reduce yearly labor supply by scaling back more in hours worked per week (over 50% reduction) than in weeks worked per year (20% reduction). The fixed costs approach cannot explain these trends. Counterfactuals show that reducing Social Security benefits by 20% causes individuals work an additional 8.6 months. Individuals choosing sharp retirement respond mostly on the extensive margin by delaying retirement eight months, while individuals choosing smooth retirement respond mostly on the intensive margin by increasing yearly labor supply and delaying retirement only one month. The second essay develops and estimates a Ben-Porath human capital model in which individuals make decisions on consumption, human capital investment, labor supply, and retirement, allowing both an endogenous wage process and an endogenous retirement decision. We estimate the model using the Method of Simulated Moments to match the life-cycle profiles of wages and hours from the PSID data. Counterfactuals of delaying NRA and removing Social Security earnings test show significant increases in one individual's human capital investment at old ages, which leads to over 20% increase in the wage profile near retirement. The third essay tests for asymmetric employer learning in the labor market using a three-period model with a match component of wages. When a worker makes her quit/stay decision in a labor market with three periods, she must consider the signaling effect of her decision in subsequent periods. This breaks down some implications derived from two-period models, which are mostly used in the empirical literature. I suggest two alternative hypothesis tests for asymmetric employer learning in the model. I use the NLSY79 Work-History data and find evidence of asymmetric employer learning from these tests