Sector Participation Decisions in Labor Supply Models

We study the short-term impact of Connecticut's Jobs First welfare reform experiment on women's labor supply and welfare participation decisions. A nonparametric optimizing model is shown to restrict the set of counterfactual choices compatible with each woman's actual choice. These revealed preference restrictions yield informative bounds on the frequency of several intensive and extensive margin responses to the experiment. We find that welfare reform induced many women to work but led some others to reduce their earnings in order to receive assistance. The bounds on this latter “ opt-in” effect imply that intensive margin labor supply responses are nontrivial. (JEL H23, H75, I38, J16, J22)

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Nonparametric Evidence on the Effects of Financial Incentives on Retirement Decisions

American Economic Journal Economic Policy ◽

10.1257/pol.20140209 ◽

2016 ◽

Vol 8 (4) ◽

pp. 160-182 ◽

Cited By ~ 18

Author(s):

Day Manoli ◽

Andrea Weber

Keyword(s):

Labor Supply ◽

Conceptual Framework ◽

Labor Force ◽

Labor Force Participation ◽

Financial Incentives ◽

Incentive Structure ◽

Retirement Benefits ◽

Retirement Decisions ◽

New Evidence ◽

Participation Decisions

This paper presents new evidence on the effects of retirement benefits on labor force participation decisions. The analysis is based on a mandated rule for employer-provided retirement benefits in Austria that creates discontinuities in the incentives for workers to delay retirement. The paper presents graphical evidence on labor supply responses and develops a conceptual framework that accounts for the dynamic incentive structure and for adjustment frictions. Using bunching methods, a semi-elasticity of participation is estimated, which ranges from 0.1 to 0.3 and is highest for incentives targeted at a delay in retirement by 6 to 9 months. (JEL D14, D91, H55, J22, J26, J65)

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Implications of higher retirement age for the labor market

Voprosy Ekonomiki ◽

10.32609/0042-8736-2017-3-22-39 ◽

2017 ◽

pp. 22-39 ◽

Cited By ~ 8

Author(s):

M. Ivanova ◽

A. Balaev ◽

E. Gurvich

Keyword(s):

Economic Growth ◽

Labor Market ◽

Labor Supply ◽

Labor Force ◽

Labor Demand ◽

Retirement Age ◽

Demographic Trends ◽

Men And Women ◽

Demographic Projections ◽

The Impact

The paper considers the impact of the increase in retirement age on labor supply and economic growth. Combining own estimates of labor participation and demographic projections by the Rosstat, the authors predict marked fall in the labor force (by 5.6 million persons over 2016-2030). Labor demand is also going down but to a lesser degree. If vigorous measures are not implemented, the labor force shortage will reach 6% of the labor force by the period end, thus restraining economic growth. Even rapid and ambitious increase in the retirement age (by 1 year each year to 65 years for both men and women) can only partially mitigate the adverse consequences of demographic trends.

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