Journal Article

Collective Labour Supply: Heterogeneity and Non-Participation

Richard Blundell, Pierre-Andre Chiappori, Thierry Magnac and Costas Meghir

in The Review of Economic Studies

Published on behalf of Review of Economic Studies Ltd

Volume 74, issue 2, pages 417-445
Published in print April 2007 | ISSN: 0034-6527
Published online April 2007 | e-ISSN: 1467-937X | DOI: http://dx.doi.org/10.1111/j.1467-937X.2007.00440.x
Collective Labour Supply: Heterogeneity and Non-Participation

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  • Demand and Supply of Labour
  • Household Behaviour and Family Economics
  • Demographic Economics
  • Wages, Compensation, and Labour Costs

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We present identification and estimation results for the “collective” model of labour supply in which there are discrete choices, censoring of hours, and non-participation in employment. We derive the collective restrictions on labour supply functions and contrast them with restrictions implied by the usual “unitary” framework. Using the large changes in the wage structure between men and women in the U.K. over the last two decades, we estimate a collective labour supply model for married couples without children. The estimates of the sharing rule show that male wages and employment have a strong influence on bargaining power within couples.

Keywords: D13; J16; J22; J31

Journal Article.  13655 words.  Illustrated.

Subjects: Demand and Supply of Labour ; Household Behaviour and Family Economics ; Demographic Economics ; Wages, Compensation, and Labour Costs

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