EconPapers    
Economics at your fingertips  
 

Joint estimation of intertemporal labor and consumption decisions: evidence from Spanish households headed by working men

Antonio Cutanda and Juan A. Sanchis-Llopis ()
Additional contact information
Antonio Cutanda: Universidad de Valencia
Juan A. Sanchis-Llopis: Universidad de Valencia and ERICES

Eurasian Economic Review, 2021, vol. 11, issue 4, No 2, 629 pages

Abstract: Abstract The aim of this paper is testing the three first-order conditions of an intertemporal optimization model for a representative individual who chooses simultaneously for her level of consumption and leisure, assuming a separable utility function. We estimate these conditions jointly in a system of equations, using a Spanish pseudo-panel data set built by combining the Family Expenditure Survey and the Labor Survey over the period 1987–1997. Our results are in line with previous empirical evidence as regards the elasticity of intertemporal substitution for consumption, as our estimate for this elasticity is between 0.4 and 0.5. Further, we also obtain the first estimate for Spain of the intertemporal elasticity of leisure. This value is above 0.3, and is comparable to other estimates found for other economies.

Keywords: Euler equation; Instrumental variables; Intertemporal substitution; Panel data (search for similar items in EconPapers)
JEL-codes: C33 C36 E21 E24 J22 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://link.springer.com/10.1007/s40822-021-00176-3 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
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:spr:eurase:v:11:y:2021:i:4:d:10.1007_s40822-021-00176-3

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/40822

DOI: 10.1007/s40822-021-00176-3

Access Statistics for this article

Eurasian Economic Review is currently edited by Dorothea Schäfer

More articles in Eurasian Economic Review from Springer, Eurasia Business and Economics Society Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().

 
Page updated 2021-11-27
Handle: RePEc:spr:eurase:v:11:y:2021:i:4:d:10.1007_s40822-021-00176-3