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Labor Supply, Home Production and Welfare Comparisons

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  • Donni, Olivier

    () (University of Cergy-Pontoise)

Abstract

We consider the collective model of labor supply with marketable domestic production. We first show that, if domestic production is mistakenly ignored, the “collective” indirect utilities that are retrieved from observed behavior will be unbiased if and only if the profit function is additive. Otherwise, in the non-additive case, the direction and the size of the bias will depend on the complementarity/substitutability of spouses’ time inputs in the production process. We then show that, even if domestic labor supplies are not observed, valid welfare comparisons are possible. This identification result generalizes that in Chiappori (1992).

Suggested Citation

  • Donni, Olivier, 2005. "Labor Supply, Home Production and Welfare Comparisons," IZA Discussion Papers 1511, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp1511
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    References listed on IDEAS

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    11. Olivier Donni, 2007. "Collective female labour supply: theory and application," Economic Journal, Royal Economic Society, vol. 117(516), pages 94-119, January.
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    14. Olivier Donni & Nicolas Moreau, 2007. "Collective Labor Supply: A Single-Equation Model and Some Evidence from French Data," Journal of Human Resources, University of Wisconsin Press, vol. 42(1).
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    Cited by:

    1. Sonia Oreffice & Climent Quintana-Domeque, 2012. "Fat spouses and hours of work: are body and Pareto weights correlated?," IZA Journal of Labor Economics, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 1(1), pages 1-21, December.
    2. Olivier Donni & Eleonora Matteazzi, 2012. "On the Importance of Household Production in Collective Models: Evidence from U.S. Data," Annals of Economics and Statistics, GENES, issue 105-106, pages 99-125.
    3. Jaime Andres Sarmiento Espinel, 2012. "Children and non-participation in a model of collective household labor supply," Serie documentos de trabajo del Centro de Estudios Económicos 2012-14, El Colegio de México, Centro de Estudios Económicos.
    4. Guy Lacroix & Natalia Radtchenko, 2011. "The changing intra-household resource allocation in Russia," Journal of Population Economics, Springer;European Society for Population Economics, vol. 24(1), pages 85-106, January.
    5. Richard Blundell & Pierre-Andre Chiappori & Thierry Magnac & Costas Meghir, 2007. "Collective Labour Supply: Heterogeneity and Non-Participation," Review of Economic Studies, Oxford University Press, vol. 74(2), pages 417-445.
    6. Laurens Cherchye & Bram De Rock & Frederic Vermeulen, 2012. "Married with Children: A Collective Labor Supply Model with Detailed Time Use and Intrahousehold Expenditure Information," American Economic Review, American Economic Association, vol. 102(7), pages 3377-3405, December.
    7. Sonia Oreffice & Climent Quintana-Domeque, 2012. "A Matter of Weight? The Role of Spouses. Physical Attractiveness on Hours of Work," CHILD Working Papers Series 7, Centre for Household, Income, Labour and Demographic Economics (CHILD) - CCA.
    8. Olivier Bargain & Miriam Beblo & Denis Beninger & Richard Blundell & Raquel Carrasco & Maria-Concetta Chiuri & François Laisney & Valérie Lechene & Nicolas Moreau & Michal Myck & Javier Ruiz-Castillo , 2006. "Does the Representation of Household Behavior Matter for Welfare Analysis of Tax-benefit Policies? An Introduction," Review of Economics of the Household, Springer, vol. 4(2), pages 99-111, June.
    9. repec:hal:journl:halshs-00482492 is not listed on IDEAS
    10. Olivier Bargain & Nicolas Moreau, 2013. "The Impact of Tax-Benefit Reforms on Labor Supply in a Simulated Nash-bargaining Framework," Journal of Family and Economic Issues, Springer, vol. 34(1), pages 77-86, March.
    11. Eleonora Matteazzi & Martina Menon & Federico Perali, 2017. "The Collective Farm-household Model: Policy and Welfare Simulations," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 39(1), pages 111-153.
    12. Olivier Donni & Nicolas Moreau, 2007. "Collective Labor Supply: A Single-Equation Model and Some Evidence from French Data," Journal of Human Resources, University of Wisconsin Press, vol. 42(1).
    13. Andreas Buehn & Alexander Karmann, 2011. "The Shadow Economy and Do-it-Yourself Activities: What Do We Know?," Chapters,in: Handbook on the Shadow Economy, chapter 7 Edward Elgar Publishing.
    14. Rana Hendy, 2010. "Rethinking Time Allocation of Egyptian Women: A Matching Analysis," Working Papers 526, Economic Research Forum, revised 06 Jan 2010.
    15. Jaime Andres Sarmiento Espinel & Edwin van Gameren, 2016. "A collective household labor supply model with children and non-participation: Theory and empirical application," Serie documentos de trabajo del Centro de Estudios Económicos 2016-11, El Colegio de México, Centro de Estudios Económicos.
    16. Bargain, Olivier & Moreau, Nicolas, 2005. "Cooperative Models in Action: Simulation of a Nash-Bargaining Model of Household Labor Supply with Taxation," IZA Discussion Papers 1480, Institute for the Study of Labor (IZA).
    17. Natalia Radchenko, 2016. "Welfare Sharing Within Households: Identification from Subjective Well-being Data and the Collective Model of Labor Supply," Journal of Family and Economic Issues, Springer, vol. 37(2), pages 254-271, June.
    18. Olivier Donni & Eleonora Matteazzi, 2016. "Collective Decisions, Household Production, and the Labor Force Participation," THEMA Working Papers 2016-05, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
    19. Rana Hendy & Catherine Sofer, 2010. "A Collective Model of Female Labor Supply : Do Distribution Factors Matter in the Egyptian Case ?," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00482492, HAL.
    20. Benoît Rapoport & Catherine Sofer & Anne Solaz, 2011. "Household production in a collective model: some new results," Journal of Population Economics, Springer;European Society for Population Economics, vol. 24(1), pages 23-45, January.

    More about this item

    Keywords

    collective model; labor supply; home production; household; welfare analysis; identification;

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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