Nonparametric Estimation of Labor Supply Functions Generated by Piece Wise Linear Budget Constraints
The basic idea in this paper is that labor supply can be viewed as a function of the entire budget set, so that one way to account non-parametrically for a nonlinear budget set is to estimate a nonparametric regression where the variable in the regression is the budget set. In the special case of a linear budget constraint, this estimator would be the same as nonparametric regression on wage and nonlabor income. Nonlinear budget sets will in general be charac-terized by many variables. An important part of the estimation method is a procedure to reduce the dimensionality of the regression problem.
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- Aronsson, Thomas & Palme, Marten, 1998.
"A Decade of Tax and Benefit Reforms in Sweden: Effects on Labour Supply, Welfare and Inequality,"
London School of Economics and Political Science, vol. 65(257), pages 39-67, February.
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IFS Working Papers
W95/07, Institute for Fiscal Studies.
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- Agell, S.A. & Meghir, C., 1995. "Male Labour Supply in Sweden : Are Incentives Important?," Papers 12, Uppsala - Working Paper Series.
- Hausman, Jerry A & Newey, Whitney K, 1995.
"Nonparametric Estimation of Exact Consumers Surplus and Deadweight Loss,"
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- N. S. Blomquist & U. Hansson-Brusewitz, 1990. "The Effect of Taxes on Male and Female Labor Supply in Sweden," Journal of Human Resources, University of Wisconsin Press, vol. 25(3), pages 317-357.
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