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Shadow Wages and Peasant Family Labour Supply: An Econometric Application to the Peruvian Sierra

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Jacoby, Hanan G

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Abstract

This paper develops a methodology for estimating structural time-allocation models for self-employed households and applies it to peasant family labor supply behavior in the Peruvian Sierra. The oppurtunity costs of time, or shadow wages, of household workers are explicitly estimated from an agricultural production function. Using an instrumental variables procedure, the household's structural labor supply parameters are recovered from variation in these shadow wages. The empirical results are robust to a number of alternative specifications and diagnostic tests and lend support to the rational allocation of time by peasant households. Copyright 1993 by The Review of Economic Studies Limited.

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Publisher Info
Article provided by Blackwell Publishing in its journal Review of Economic Studies.

Volume (Year): 60 (1993)
Issue (Month): 4 (October)
Pages: 903-21
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Handle: RePEc:bla:restud:v:60:y:1993:i:4:p:903-21

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  1. Christophe Muller, 2003. "Female Activity Choice In A Dual Context: An Integrated Model For Formal And Informal Sectors In Cameroon," Working Papers. Serie AD 2003-39, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie). [Downloadable!]
  2. Sonia Laszlo, 2003. "Education, Labour Supply and Market Development in Rural Peru," Development and Comp Systems 0312005, EconWPA. [Downloadable!]
  3. Takahiro Ito, 2007. "Caste Discrimination and Transaction Costs in the Labor Market: Evidence from Rural North India," Hi-Stat Discussion Paper Series d06-200, Institute of Economic Research, Hitotsubashi University. [Downloadable!]
  4. John Cockburn, 2004. "Income Contributions of Child Work in Rural Ethiopia," Development and Comp Systems 0409051, EconWPA. [Downloadable!]
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  5. Cornilius Chikwama, 2004. "Rural Off-Farm Employment and Farm Investment: An Analytical Framework and Evidence from Zimbabwe," CERT Discussion Papers 0403, Centre for Economic Reform and Transformation, Heriot Watt University. [Downloadable!]
  6. Jean-Louis ARCAND & CONNING & ETHIER, 1999. "Class position and Economic Behavior in a Tunisian Village: Selective Separability in a Multi-Factor Household Model," Working Papers 199911, CERDI. [Downloadable!]
  7. Cornilius Chikawama, 2004. "Quota Rural Off-Farm Employment and Farm Investment: An Analytical Framework and Evidence from Zimbabwe," Working Papers E04, Department of Economics, School of Management and Languages, Heriot Watt University. [Downloadable!]
  8. Renos Vakis & Elisabeth Sadoulet & Alain de Janvry & Carlo Cafiero, 2004. "Testing for Separability in Household Models with Heterogeneous Behavior: A Mixture Model Approach," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series 990, Department of Agricultural & Resource Economics, UC Berkeley. [Downloadable!]
  9. Unai Pascual & Edward Barbier, 2005. "On- and off-farm labor decisions by slash-and-burn farmers in Yucatan (Mexico)," Environmental Economy and Policy Research Working Papers 06.2005, University of Cambridge, Department of Land Economics, revised 2005. [Downloadable!]
  10. Terry Sicular & Yaohui Zhao, 2002. "Earnings and Labor Mobility in Rural China: Implications for China's WTO Entry," University of Western Ontario, RBC Financial Group Economic Policy Research Institute Working Papers 20028, University of Western Ontario, RBC Financial Group Economic Policy Research Institute. [Downloadable!]
  11. Grosh, Margaret E & Glewwe, Paul, 1998. "Data Watch: The World Bank's Living Standards Measurement Study Household Surveys," Journal of Economic Perspectives, American Economic Association, vol. 12(1), pages 187-96, Winter. [Downloadable!] (restricted)
  12. M. Menon & F. Perali & F. Rosati, 2005. "The Shadow Wage of Child Labour: An Application to Nepal," UCW Working Paper 11, Understanding Children's Work (UCW Project). [Downloadable!]
  13. Claudio ARAUJO & Catherine ARAUJO BONJEAN & Jean-Louis ARCAND, 1999. "Capital humain, productivité agricole, et travail féminin : variables latentes et séparabilité dans les modèles de ménage," Working Papers 199912, CERDI. [Downloadable!]
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