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Journal Article

Constrained vs unconstrained labor supply: the economics of dual job holding

Authors

Publication date

22 Nov 2017

Summary

This paper develops a unified model of dual and unitary job holding based on a Stone-Geary utility function. The model incorporates both constrained and unconstrained labor supply. Panel data methods are adapted to accommodate unobserved heterogeneity and multinomial selection into six mutually exclusive labor supply regimes. We estimate the wage and income elasticities arising from selection and unobserved heterogeneity as well as from the Stone-Geary Slutsky equations. The labor supply model is estimated with data from the British Household Panel Survey 1991–2008. Among dual job holders, our study finds that the Stone-Geary income and wage elasticities are much larger for labor supply to the second job compared with the main job. When the effects of selection and unobserved heterogeneity are taken account of, the magnitudes of these elasticities on the second job tend to be significantly reduced.

Published in

Journal of Population Economics

DOI

https://doi.org/10.1007/s00148-017-0678-4

ISSN

16

Subjects

Labour Market, Labour Economics, Economics, and Wages And Earnings

Links

Albert Sloman Library Periodicals *restricted to Univ. Essex registered users* - http://serlib0.essex.ac.uk/record=b1599762~S5

Notes

Online Early

#524894


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