The Sensitivity of Labor Demand Functions to Choice of Dependent Variable
This paper investigates whether the parameters of labor demand functions are sensitive to alternative methods of estimation. The assumption that the production technology is of the Generalized Leontief type implies that the demand system can be estimated by analyzing cross-section differences in earnings across labor markets, by studying longitudinal changes in earnings within a labor market, or by investigating cross-section differences in labor force participation rates across labor markets. The estimation of these models on the 1970 and 1980 Public Use Samples from the U.S. Census reveals that the estimates of labor demand functions are indeed quite robust to major specification changes.
|Date of creation:||Jun 1985|
|Date of revision:|
|Publication status:||published as Borjas, George. "The Sensitivity of Labor Demand Functions to Choice of Dependent Variable," Review of Economics and Statistics, Vol. LXVIII, No. 1, pp. 58-66, February 1986.|
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- Sato, Ryuzo & Koizumi, Tetsunori, 1973. "On the Elasticities of Substitution and Complementarity," Oxford Economic Papers, Oxford University Press, vol. 25(1), pages 44-56, March.
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- Richard B. Freeman, 1979.
"The Effect of Demographic Factors on Age-Earnings Profiles,"
NBER Working Papers
0316, National Bureau of Economic Research, Inc.
- Richard B. Freeman, 1979. "The Effect of Demographic Factors on Age-Earnings Profiles," Journal of Human Resources, University of Wisconsin Press, vol. 14(3), pages 289-318.
- Mark C. Berger, 1983. "Changes in Labor Force Composition and Male Earnings: A Production Approach," Journal of Human Resources, University of Wisconsin Press, vol. 18(2), pages 177-196.
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