Kalachek, Edward; Mellow, Wesley; Raines, Frederic
April 1978
Industrial & Labor Relations Review;Apr78, Vol. 31 Issue 3, p356
Academic Journal
Econometric investigations of the male labor supply function based on individual household data have yielded a wide variety of substitution elasticities. The authors maintain that this result has been due partially to inadequate theoretical grounding of both the wage and labor supply concepts, which they treat by decomposing the current wage into permanent and transitory components and by expanding labor supply to take account of unemployment time. Using data taken from the National Longitudinal Survey, they lest their thesis and find that for mature males, as predicted, permanent and transitory wage components generate differential supply responses and most unemployment time is actually desired work time. They also conclude that the explainable variation in the labor supply of mature males results less from variations in wages than from variations in attitudes, health, and demographic factors.


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