Endogenous labour supply, habits and aspirations
AbstractMotivated by the increasing literature on endogenous preferences, this paper investigates the implications of the introduction of habit and aspiration formation when labour supply is endogenous, in an OLG small open economy. In contrast with models with exogenous labour supply where aspirations always reduce economic performance, we show that in a model with endogenous labour supply greater aspirations lead to a higher long run savings and economic performance, through their impact on the labour/leisure choice.
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Bibliographic InfoPaper provided by Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy in its series Discussion Papers with number 2012/144.
Date of creation: 01 Sep 2012
Date of revision:
Endogenous preferences; Fertility; OLG model.;
Find related papers by JEL classification:
- J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
- O41 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
This paper has been announced in the following NEP Reports:
- NEP-AGE-2012-11-03 (Economics of Ageing)
- NEP-ALL-2012-11-03 (All new papers)
- NEP-DEM-2012-11-03 (Demographic Economics)
- NEP-DGE-2012-11-03 (Dynamic General Equilibrium)
- NEP-EVO-2012-11-03 (Evolutionary Economics)
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