How Credible Are Shrinking Wage Elasticities of Married Women Labour Supply?

Qin, Duo; van Huellen, Sophie; Wang, Qing Chao

Abstract

This paper delves into the well-known phenomenon of shrinking wage elasticities for married women in the US over recent decades. The results of a novel model experimental approach via sample data ordering unveil considerable heterogeneity across different wage groups. Yet, surprisingly constant wage elasticity estimates are maintained within certain wage groups over time. In addition to those constant wage elasticity estimates, we find that the composition of working women into different wage groups has changed considerably, resulting in shrinking wage elasticity estimates at the aggregate level. These findings would be impossible to obtain had we not dismantled and discarded the instrumental variable estimation route.

Citation

Qin, D., van Huellen, S., & Wang, Q. C. (2016). How Credible Are Shrinking Wage Elasticities of Married Women Labour Supply?. Econometrics, 4(1), 1-31. https://doi.org/10.3390/econometrics4010001

• Journal Article Type: Article
• Acceptance Date: Dec 10, 2015
• Online Publication Date: Dec 25, 2016
• Publication Date: Jan 1, 2016
• Deposit Date: Jan 6, 2016
• Publicly Available Date: Sep 4, 2019
• Journal: Econometrics
• Electronic ISSN: 2225-1146
• Publisher: MDPI
• Peer Reviewed: Peer Reviewed
• Volume: 4
• Issue: 1
• Pages: 1-31
• DOI: https://doi.org/10.3390/econometrics4010001