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Nonparametric Estimation of Labor Supply and Demand Factors

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  • Tsunao Okumura

Abstract

This article derives sharp bounds on labor supply and demand shift variables within a nonparametric simultaneous equations model using only observations of the intersection of upward sloping supply curves and downward sloping demand curves. Furthermore, I demonstrate that these bounds tighten with the imposition of plausible assumptions on the distribution of the disturbance terms. Using Katz and Murphy's (1992) panel data on wages and labor inputs, I estimate these bounds and assess the supply and demand factors that determine changes within male--female wage differentials and the college wage premium.

Suggested Citation

  • Tsunao Okumura, 2011. "Nonparametric Estimation of Labor Supply and Demand Factors," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 29(1), pages 174-185, January.
    • Handle: RePEc:taf:jnlbes:v:29:y:2011:i:1:p:174-185
    DOI: 10.1198/jbes.2010.08068
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    Cited by:

    1. Santeramo, Fabio Gaetano, 2014. "On the estimation of supply and demand elasticities of agricultural commodites," AGRODEP technical notes TN-10, International Food Policy Research Institute (IFPRI).
    2. Tsunao Okumura & Emiko Usui, 2014. "Concave‐monotone treatment response and monotone treatment selection: With an application to the returns to schooling," Quantitative Economics, Econometric Society, vol. 5, pages 175-194, March.

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