Labor Supply Elasticities: Overcoming Nonclassical Measurement Error Using More Accurate Hours Data

Garry Barrett and Daniel Hamermesh

No 10404, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We measure the impact of measurement error in labor-supply elasticities estimated over recalled usual work hours, as is ubiquitous in the literature. Employing hours of work in diaries collected by the American Time Use Survey, 2003-12, along with the same respondents' recalled usual hours, we show that the latter yield elasticities that are positively biased. We argue that this bias arises from the salience on recalled hours of differences in wage rates.

Keywords: labor supply; measurement error; time use (search for similar items in EconPapers)
JEL-codes: C21 J22 (search for similar items in EconPapers)
Pages: 14 pages
Date: 2016-12
New Economics Papers: this item is included in nep-pbe
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Citations: View citations in EconPapers (4)

Published - published in: Journal of Human Resources, 2019, 54 (1), 255 - 265

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Related works:
Journal Article: Labor Supply Elasticities: Overcoming Nonclassical Measurement Error Using More Accurate Hours Data (2019)
Working Paper: Labor Supply Elasticities: Overcoming Nonclassical Measurement Error Using More Accurate Hours Data (2016)
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