The Effects of Male and Female Labor Supply on Commodity Demands

Martin Browning · Costas Meghir

518 citations0/0 files storedEconometrica

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Economics of Agriculture and Food Markets Labor market dynamics and wage inequality Gender, Labor, and Family Dynamics

Abstract

The authors examine the effects of male and female labor supply on household demands and present a simple and robust test for the separability of demands from labor supply. Using data on individual households from six years of the U.K. Family Expenditure Survey, they estimate a demand system for seven goods that includes hours and participation dummies as conditioning variables. Allowance is made for the possible endogeneity of theses conditioning labor-supply variables. The authors find that separability is rejected. Furthermore, they present evidence that ignoring labor supply leads to bias in the parameter estimates. Copyright 1991 by The Econometric Society.

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References

1978Specification Tests in Econometrics 1981Lectures on Public Economics.1987The Sensitivity of an Empirical Model of Married Women's Hours of Work to Economic and Statistical Assumptions 1993What do we Learn About Consumer Demand Patterns from Micro Data 1986Does Saving Anticipate Declining Labor Income? An Alternative Test of the Permanent Income Hypothesis

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