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Labor Supply of Fishermen: An Empirical Analysis

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  • Stafford, Tess

Abstract

When income effects are small, standard life-cycle models of labor supply predict a positive response in hours worked to increases in remuneration. However, several re- cent studies have found negative wage elasticities, casting doubt on the standard labor supply model. This paper aims to resolve some of this controversy by examining the responsiveness of the daily labor supply of fishermen to transitory variations in the wage using rich data from the Florida spiny lobster fishery. The data include complete records of all fishing trips made by Florida lobster fishermen over a twenty-year period and include two measures of effort - hours at sea and, when relevant, number of traps pulled - which makes it possible to look at the intensive labor supply margin in addition to the extensive margin. Results suggest that the wage elasticity of labor supply (par- ticipation) is positive and statistically different from zero, with a range of 1.05 to 1.31 for commercial trappers and 0.76 to 1.82 for commercial divers. Results also suggest that the wage elasticity of hours worked is positive and statistically different from zero, although quite small for trappers. Specifically, the elasticity ranges from 0.06 to 0.09 for trappers and 0.82 to 0.94 for divers. Although I do not specifically test a model of reference dependent preferences, these results support the standard neoclassical model of intertemporal substitution.

Suggested Citation

  • Stafford, Tess, 2012. "Labor Supply of Fishermen: An Empirical Analysis," 2012 Conference (56th), February 7-10, 2012, Freemantle, Australia 124450, Australian Agricultural and Resource Economics Society.
  • Handle: RePEc:ags:aare12:124450
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    References listed on IDEAS

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    1. Altonji, Joseph G, 1986. "Intertemporal Substitution in Labor Supply: Evidence from Micro Data," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages 176-215, June.
    2. Colin Camerer & Linda Babcock & George Loewenstein & Richard Thaler, 1997. "Labor Supply of New York City Cabdrivers: One Day at a Time," The Quarterly Journal of Economics, Oxford University Press, pages 407-441.
    3. Ernst Fehr & Lorenz Goette, 2007. "Do Workers Work More if Wages Are High? Evidence from a Randomized Field Experiment," American Economic Review, American Economic Association, pages 298-317.
    4. Henry S. Farber, 2005. "Is Tomorrow Another Day? The Labor Supply of New York City Cabdrivers," Journal of Political Economy, University of Chicago Press, vol. 113(1), pages 46-82, February.
    5. Gerald S. Oettinger, 1999. "An Empirical Analysis of the Daily Labor Supply of Stadium Vendors," Journal of Political Economy, University of Chicago Press, vol. 107(2), pages 360-392, April.
    6. Weitzman, Martin L., 2002. "Landing Fees vs Harvest Quotas with Uncertain Fish Stocks," Journal of Environmental Economics and Management, Elsevier, vol. 43(2), pages 325-338, March.
    7. Gautam, Amy Buss & Strand+, Ivar & Kirkley++, James, 1996. "Leisure/Labor Tradeoffs: The Backward-Bending Labor Supply in Fisheries," Journal of Environmental Economics and Management, Elsevier, vol. 31(3), pages 352-367, November.
    8. Henry S. Farber, 2008. "Reference-Dependent Preferences and Labor Supply: The Case of New York City Taxi Drivers," American Economic Review, American Economic Association, vol. 98(3), pages 1069-1082, June.
    9. Browning, Martin & Deaton, Angus & Irish, Margaret, 1985. "A Profitable Approach to Labor Supply and Commodity Demands over the Life-Cycle," Econometrica, Econometric Society, vol. 53(3), pages 503-543, May.
    10. MaCurdy, Thomas E, 1981. "An Empirical Model of Labor Supply in a Life-Cycle Setting," Journal of Political Economy, University of Chicago Press, vol. 89(6), pages 1059-1085, December.
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    Keywords

    Labor and Human Capital;

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