Reference-dependent behaviour of paua (abalone) divers in New Zealand
Håkan Eggert () and
Viktoria Kahui ()
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Viktoria Kahui: University of Otago, Dept of Economics, Postal: PO Box 56, Dunedin, New Zealand
No 513, Working Papers in Economics from University of Gothenburg, Department of Economics
We study dynamic labour supply using data on paua (abalone) divers in New Zealand. The divers face stable, flat prices per kilogram after each catch, but experience transitory wage changes due to varying weather and water conditions, and are free to vary their daily working hours and display an intermittent working pattern. We find non-linear wage elasticities, rejecting the standard neo-classical prediction. We explore potentially distorting factors, but find little evidence. Applying Kszegi and Rabin’s (2006) theory where workers have both income and hours targets could explain our result. In particular, our divers appear to be primarily guided by the hours target. http://hdl.handle.net/2077/26589
Keywords: labour supply; wage elasticity; income e target; reference-dependent (search for similar items in EconPapers)
JEL-codes: J01 J22 (search for similar items in EconPapers)
Pages: 44 pages
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