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Reconciling Micro and Macro Labor Supply Elasticities: A Structural Perspective

  • Michael P. Keane

    ()

    (Nuffield College, University of Oxford)

  • Richard Rogerson

    (Princeton University, USA)

This survey deals with an issue that is extremely important for a wide range of applied issues - the magnitude of aggregate labor supply responses to various changes in the economic environment.� In addition to being a very important issue, it is also well known to be quite controversial.� In particular, there is a long-standing controversy driven by the fact that on the one hand, researchers who look at micro data typically estimate relatively small labor supply elasticities, while on the other hand, researchers who use representative agent models to study aggregate outcomes typically employ parameterizations that imply relatively large aggregate labor supply elasticities.

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File URL: http://www.nuffield.ox.ac.uk/economics/papers/2012/KR_final_oxford.pdf
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Paper provided by Economics Group, Nuffield College, University of Oxford in its series Economics Papers with number 2012-W12.

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Length: 117 pages
Date of creation: 31 Oct 2012
Date of revision:
Handle: RePEc:nuf:econwp:1212
Contact details of provider: Web page: http://www.nuff.ox.ac.uk/economics/

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