EconPapers    
Economics at your fingertips  
 

Comparing Labor Supply Elasticities in Europe and the US: New Results

Olivier Bargain (), Kristian Orsini () and Andreas Peichl ()

No 525, SOEPpapers on Multidisciplinary Panel Data Research from DIW Berlin, The German Socio-Economic Panel (SOEP)

Abstract: We suggest the first large-scale international comparison of labor supply elasticities for 17 European countries and the US, separately by gender and marital status. Measurement differences are netted out by using a harmonized empirical approach and comparable data sources. We find that own-wage elasticities are relatively smalland much more uniform across countries than previously thought. Differences exist nonetheless and are found not to arise from different tax-benefit systems or demographic compositions across countries. Thus, we cannot reject that countries have genuinely different preferences. Three other results, important for welfare analysis, are consistent over all countries: the extensive (participation) margin dominates the intensive (hours) margin; for singles, this leads to larger labor supply responses in low-income groups; income elasticities are extremely small everywhere. Finally, the results for cross-wage elasticities in couples are opposed between regions, consistent with complementarity in spouses' leisure in the US versus substitution in spouses' household production in Europe.

Keywords: household labor supply; elasticity; taxation; Europe; US (search for similar items in EconPapers)
JEL-codes: C25 C52 H31 J22 (search for similar items in EconPapers)
Pages: 48 p.
Date: 2012
New Economics Papers: this item is included in nep-eec, nep-eur, nep-geo, nep-lab and nep-lma
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (19) Track citations by RSS feed

Downloads: (external link)
http://www.diw.de/documents/publikationen/73/diw_01.c.414071.de/diw_sp0525.pdf (application/pdf)

Related works:
Working Paper: Comparing Labor Supply Elasticities in Europe and the US: New Results (2013) Downloads
Working Paper: Comparing Labor Supply Elasticities in Europe and the US: New Results (2012) Downloads
Working Paper: Comparing Labor Supply Elasticities in Europe and the US: New Results (2012) Downloads
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:diw:diwsop:diw_sp525

Access Statistics for this paper

More papers in SOEPpapers on Multidisciplinary Panel Data Research from DIW Berlin, The German Socio-Economic Panel (SOEP) Contact information at EDIRC.
Bibliographic data for series maintained by Bibliothek ().

 
Page updated 2020-08-08
Handle: RePEc:diw:diwsop:diw_sp525