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Collective Household Labor Supply: Nonparticipation and Income Taxation

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Author Info
Olivier Donni () (Center for Research on Economic Fluctuations and Employment, UQAM)

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Abstract

In this paper, we adopt the usual assumptions of the collective approach, i.e. individualism and efficiency, to study household labor supply. The theoretical innovation is twofold. First, we incorporate the decision to participate in the labor market in the initial setting. Second, we abandon the assumption of linearity of the budget constraint. We show that (i) structural elements such as preferences or the outcome of the decision process can be recovered, and (ii) testable restrictions are generated from the observation of the household labor supplies. We also examine, for this model, how to simulate the incidence of fiscal reforms.

Dans cet article, nous adoptons les hypothèses habituelles de l'approche collective, à savoir, l'individualisme et l'efficacité, pour étudier l'offre de travail du ménage. L'innovation théorique est double. D'une part, nous incorporons dans le cadre initial la décision de participer au marché du travail. D'autre part, nous abandonnons l'hypothèse de linéarité de la contrainte budgetaire. Nous montrons alors que (i) des éléments structurels du processus de décision peuvent être retrouvés, et (ii) des restrictions testables sont générées de l'observation des offres de travail du ménage. Nous examinons également, pour ce modèle, comment faire des simulations de réformes fiscales.

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Publisher Info
Paper provided by CREFE, Université du Québec à Montréal in its series Cahiers de recherche CREFE / CREFE Working Papers with number 140.

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Length: 24 pages
Date of creation: Sep 2001
Date of revision:
Handle: RePEc:cre:crefwp:140

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Related research
Keywords: Collective Models; Labor Supply; Income Tax; Corner Solutions;

Other versions of this item:

Find related papers by JEL classification:
H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

This paper has been announced in the following NEP Reports:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Chiappori, Pierre-Andre, 1992. "Collective Labor Supply and Welfare," Journal of Political Economy, University of Chicago Press, vol. 100(3), pages 437-67, June. [Downloadable!] (restricted)
    Other versions:
  2. Apps, Patricia F. & Rees, Ray, 1988. "Taxation and the household," Journal of Public Economics, Elsevier, vol. 35(3), pages 355-369, April. [Downloadable!] (restricted)
  3. Olivier Donni, 2001. "Collective Female Labor Supply: Theory and Application," Cahiers de recherche CREFE / CREFE Working Papers 141, CREFE, Université du Québec à Montréal. [Downloadable!]
    Other versions:
  4. Chiappori, Pierre-Andre, 1988. "Rational Household Labor Supply," Econometrica, Econometric Society, vol. 56(1), pages 63-90, January. [Downloadable!] (restricted)
  5. Richard Blundell ; Pierre-André Chiappori ; Thierry Magnac ; Costas Meghir, 2001. "Collective Labor Supply : Heterogeneity and Nonparticipation," Working Papers 2001-32, Centre de Recherche en Economie et Statistique. [Downloadable!]
    Other versions:
  6. Brett, Craig, 1998. "Tax reform and collective family decision-making," Journal of Public Economics, Elsevier, vol. 70(3), pages 425-440, December. [Downloadable!] (restricted)
  7. Pierre-André Chiappori & Bernard Fortin & Guy Lacroix, 2001. "Marriage Market, Divorce Legislation and Household Labor Supply," CIRANO Working Papers 2001s-16, CIRANO. [Downloadable!]
    Other versions:
  8. McElroy, Marjorie B & Horney, Mary Jean, 1981. "Nash-Bargained Household Decisions: Toward a Generalization of the Theory of Demand," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 22(2), pages 333-49, June. [Downloadable!] (restricted)
  9. Fortin, Bernard & Lacroix, Guy, 1997. "A Test of the Unitary and Collective Models of Household Labour Supply," Economic Journal, Royal Economic Society, vol. 107(443), pages 933-55, July. [Downloadable!] (restricted)
  10. Lundberg, Shelly & Pollak, Robert A, 1996. "Bargaining and Distribution in Marriage," Journal of Economic Perspectives, American Economic Association, vol. 10(4), pages 139-58, Fall. [Downloadable!] (restricted)
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