Reservation Raises: The Aggregate Labour Supply Curve at the Extensive Margin

• 成果类型: Article
• 署名作者: Mui, Preston; Schoefer, Benjamin
• 署名单位: University of California System; University of California Berkeley; University of California System; University of California Berkeley
• 刊物名称: REVIEW OF ECONOMIC STUDIES
• ISSN/ISSBN: 0034-6527
• DOI: 10.1093/restud/rdae021
• 发表日期: 2024
• 页码: 442-475
• 关键词: life-cycle model; indivisible labor; elasticities; micro; unemployment; time; consumption; insurance; income; COSTS

摘要

We measure desired labour supply at the extensive (employment) margin in two representative surveys of the U.S. and German populations. We elicit reservation raises: the percent wage change that renders a given individual indifferent between employment and nonemployment. It is equal to her reservation wage divided by her actual, or potential, wage. The reservation raise distribution is the nonparametric aggregate labour supply curve. Locally, the curve exhibits large short-run elasticities above 3, consistent with business cycle evidence. For larger upward shifts, arc elasticities shrink towards 0.5, consistent with quasi-experimental evidence from tax holidays. Existing models fail to match this nonconstant, asymmetric curve.