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Nonparametric estimation of labor supply functions generated by piece wise linear budget constraints
Uppsala University, Humanistisk-samhällsvetenskapliga vetenskapsområdet, Faculty of Social Sciences, Department of Economics.
Uppsala University, Humanistisk-samhällsvetenskapliga vetenskapsområdet, Faculty of Social Sciences, Department of Economics.
1997 (English)Report (Other academic)
Abstract [en]

The basic idea in this paper is that labor supply can be viewed as a function of the entire budget set, so that one way to account non-parametrically for a nonlinear budget set is to estimate a nonparametric regression where the variable in the regression is the budget set. In the special case of a linear budget constraint, this estimator would be the same as nonparametric regression on wage and nonlabor income. Nonlinear budget sets will in general be charac-terized by many variables. An important part of the estimation method is a procedure to reduce the dimensionality of the regression problem. It is of interest to see if nonparametrically estimated labor supply functions support the result of earlier studies using parametric methods. We therefore apply parametric and nonparametric labor supply functions to calculate the effect of recent Swedish tax reform. Qualitatively the nonparametric and parametric labor supply functions give the same results. Recent tax reform in Sweden has increased labor supply by a small but economically important amount.

Place, publisher, year, edition, pages
Uppsala: Nationalekonomiska institutionen , 1997. , p. 38
Series
Working paper, ISSN 0284-2904
Keywords [en]
Economics
Keywords [sv]
Nationalekonomi
National Category
Economics
Identifiers
URN: urn:nbn:se:uu:diva-2388ISBN: 99-2465133-2 (print)OAI: oai:DiVA.org:uu-2388DiVA, id: diva2:128649
Available from: 1997-01-01 Created: 1997-01-01

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CiteExportLink to record
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Citation style
  • apa
  • ieee
  • modern-language-association
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  • Other style
More styles
Language
  • de-DE
  • en-GB
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  • nn-NB
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Output format
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