Nonparametric Structural Estimation of Labor Supply in the Presence of Censoring

Reprint No. 2012:15

Author(s): Che-Yuan LiangYear: 2012 Title: Journal of Public Economics Volume (No.): 96 (1-2) Pages: 89–103
Online article (restrictions may apply)

This paper extends the nonparametric structural method to estimate labor supply developed by Blomquist and Newey (2002) to handle cases in which there are individuals who do not work. The method is then applied to married women in Sweden from 1973 to 1999. I find an uncompensated wage elasticity of 0.98 and an income elasticity of -0.10, with the participation margin accounting for one third of the wage elasticity and two thirds of the income elasticity. The elasticities vary, however, a lot over time due to differences in tax systems and demographics. I also find results consistent with tax rates being around the net government revenue maximizing rates.

Liang, Che-Yuan (2012), "Nonparametric Structural Estimation of Labor Supply in the Presence of Censoring". Journal of Public Economics 96(1-2), 89–103.

Sick of Inequality?

An Introduction to the Relationship between Inequality and Health

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In this book Andreas Bergh, Therese Nilsson, IFN and Lund University, and Daniel Waldenström, IFN and Paris School of Economics, France, review the latest research on the relationship between inequality and health. What does inequality mean for our health? Does increasing income inequality affect outcomes such as obesity, life expectancy and subjective well-being?


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