Using Labor Supply Elasticities to Learn about Income Inequality

• Tác giả: Katy Bergstrom
• Ngôn ngữ: eng
• Ký hiệu phân loại: 339.22 Distribution of aggregate personal income and wealth
• Thông tin xuất bản: World Bank, Washington, DC, 2020
• Bộ sưu tập: Tài liệu truy cập mở
• ID: 291206
• Chủ đề: 1. ELASTICITY; 2. INCOME INEQUALITY; 3. LABOR PRODUCTIVITY; 4. LABOR SUPPLY; 5. PREFERENCE

Tóm tắt

This paper argues that labor supply elasticities encode information about the determinants of income inequality. In the theoretical framework, individuals choose labor supply conditional on productivities and preferences for consumption relative to leisure. The paper shows that reduced-form labor supply elasticities allow one to isolate the components of income due to productivities versus preferences. The paper then investigates what labor supply elasticities imply about the importance of productivities versus preferences in the United States. Estimates from the literature imply productivities drive most of income inequality. Larger income effects and larger differences between income and hours worked elasticities imply preferences play an increasingly important role.