Collective Labour Supply: Heterogeneity and Non-Participation

59 Pages Posted: 29 Dec 2005

See all articles by Richard W. Blundell

Richard W. Blundell

UCL; Centre for Economic Policy Research (CEPR)

Pierre-Andre Chiappori

Columbia University - Graduate School of Arts and Sciences, Department of Economics

Thierry Magnac

Toulouse School of Economics; University of Toulouse 1 - Industrial Economic Institute (IDEI); IZA Institute of Labor Economics; Centre for Economic Policy Research (CEPR)

Costas Meghir

Yale University; Yale University - Cowles Foundation; Institute for Fiscal Studies (IFS); National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR); IZA Institute of Labor Economics

Date Written: October 2005

Abstract

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 UK over the last two decades we estimate a collective labour supply model for married couples without children. The implications of the unitary framework are rejected while those of the collective approach are not. The estimates of the sharing rule show that wages have a strong influence on bargaining power within couples.

Keywords: Collective models, labour supply

JEL Classification: D11, D12, D13, D70, J22

Suggested Citation

Blundell, Richard W. and Chiappori, Pierre-Andre and Magnac, Thierry and Meghir, Costas, Collective Labour Supply: Heterogeneity and Non-Participation (October 2005). CEPR Discussion Paper No. 5287, Available at SSRN: https://ssrn.com/abstract=872745

Richard W. Blundell

UCL ( email )

Department of Economics
Gower Street
London, WC1E 6BT
United Kingdom
+44 20 7504 5863 (Phone)
+44 20 7916 2773 (Fax)

HOME PAGE: http://www.ucl.ac.uk/~uctp39a/

Centre for Economic Policy Research (CEPR)

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Pierre-Andre Chiappori

Columbia University - Graduate School of Arts and Sciences, Department of Economics ( email )

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Thierry Magnac (Contact Author)

Toulouse School of Economics ( email )

Manufacture des Tabacs
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France

University of Toulouse 1 - Industrial Economic Institute (IDEI) ( email )

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France

IZA Institute of Labor Economics ( email )

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Centre for Economic Policy Research (CEPR) ( email )

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Costas Meghir

Yale University ( email )

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Yale University - Cowles Foundation ( email )

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Centre for Economic Policy Research (CEPR)

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IZA Institute of Labor Economics

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Germany

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