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Shadow Wages And Peasant Family Labor Supply; An Econometric Application To The Peruvian Sierra

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  • JACOBY, H.G.

Abstract

This paper develops a methodology for estimating structural time-allocation models for self-employed households and applies it to peasant family labour supply behaviour in the Peruvian Sierra. The opportunity costs of time, or shadow wages, of household workers are explicitly estimated from an agricultural production function. Using an instrumental variables procedure, the household's structural labour supply parameters are recovered from variation in these shadow wages. The empirical results are robust to a number of alternative specifications and diagnostic tests and lend support to the rational allocation of time by peasant households.
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Suggested Citation

  • Jacoby, H.G., 1990. "Shadow Wages And Peasant Family Labor Supply; An Econometric Application To The Peruvian Sierra," Papers 73, World Bank - Living Standards Measurement.
    • Handle: RePEc:fth:wobali:73
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    Keywords

    prix du marche ; family ; perou;
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