Labor Supply Within the Firm
Michele Battisti (michele.battisti@gla.ac.uk),
Ryan Michaels and
Choonsung Park
No 20-27, Working Papers from Federal Reserve Bank of Philadelphia
Abstract:
There is substantial variation in working time even within employer-employee matches, and yet estimates of the Frisch elasticity of labor supply can be near zero. This paper proposes a tractable theory of earnings and working time to interpret these observations. Production complementarities attenuate the response of working time to idiosyncratic, or worker-specific, shocks, but firm-wide shocks are mediated by preference parameters. The model can be identified using firm-worker matched data, revealing a Frisch elasticity of around 0.5. A quasi-experimental approach that mimics the design of earlier studies by exploiting only idiosyncratic variation would find an elasticity less than half this.
Keywords: Intensive margin; production complementarities; bargaining; employee-employer data (search for similar items in EconPapers)
JEL-codes: J22 J23 J31 (search for similar items in EconPapers)
Pages: 52
Date: 2020-07-17
New Economics Papers: this item is included in nep-lma
References: Add references at CitEc
Citations:
Downloads: (external link)
https://www.philadelphiafed.org/-/media/frbp/asset ... ers/2020/wp20-27.pdf (application/pdf)
Related works:
Working Paper: Labor supply within the firm (2016)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
HTML/Text
Persistent link: https://EconPapers.repec.org/RePEc:fip:fedpwp:88449
Ordering information: This working paper can be ordered from
phil.library.mailbox@phil.frb.org
DOI: 10.21799/frbp.wp.2020.27
Access Statistics for this paper
More papers in Working Papers from Federal Reserve Bank of Philadelphia Contact information at EDIRC.
Bibliographic data for series maintained by Beth Paul (beth.paul@phil.frb.org).