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.
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Paper provided by University of Bonn, Germany in its series Discussion Paper Serie A with number
586.
Length: pages Date of creation: Nov 1998 Date of revision: Handle: RePEc:bon:bonsfa:586
Contact details of provider: Postal: Bonn Graduate School of Economics, University of Bonn, Adenauerallee 24 - 26, 53113 Bonn, Germany Fax: +49 228 73 9221 Web page: http://www.bgse.uni-bonn.de/index.php?id=517
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Find related papers by JEL classification: C14 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: General - - - Semiparametric and Nonparametric Methods C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
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