 Estimating Frisch Labor Supply Elasticity in JapanSachiko Kuroda and Isamu Yamamoto No 07-E-05, IMES Discussion Paper Series from Institute for Monetary and Economic Studies, Bank of Japan Abstract: Using Japanese data from the 1990s aggregated by prefecture, age group, and sex, we estimate Frisch labor supply elasticity, which has been seldom estimated in Japan. The change in labor supply can be decomposed into two labor-supply behaviors: extensive margin, indicating workers f entry and exit from the labor market; and intensive margin, indicating changes in hours of work in response to a wage change. Our estimates of the Frisch elasticity on the extensive and intensive margins combined are in the range of 0.2 to 0.7 for males, 1.3 to 1.5 for females, and 0.7 to 1.0 for both sexes. Our estimates of the Frisch elasticity on only the intensive margin are in the range of 0.1 to 0.2 for all three categories. These results suggest that extensive margin explains the bulk of labor-supply changes in Japan. As for the changes in the estimates of the Frisch elasticity in Japan from the 1990s, it has been either unchanged or in a declining trend on the extensive and intensive margins combined, either unchanged or in a slight rising trend on only the intensive margin, and in a declining trend on only the extensive margin. Keywords: Labor supply; Frisch elasticity; Extensive margin; Intensive margin (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:ime:imedps:07-e-05 Access Statistics for this paper More papers in IMES Discussion Paper Series from Institute for Monetary and Economic Studies, Bank of Japan Contact information at EDIRC. |
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