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Title: Married Women's Labor Supply: A Comparison of Alternative Estimation Procedures
Resulting in 1 citation.
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Cogan, John F. |
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Married Women's Labor Supply: A Comparison of Alternative Estimation Procedures In: Female Labor Supply: Theory and Estimation. JP Smith, ed., Princeton, NJ: Princeton University Press, 1980: 90-118 Cohort(s): Mature Women Publisher: Princeton University Press Keyword(s): Career Patterns; Dual-Career Families; Educational Returns; Labor Supply; Research Methodology Permission to reprint the abstract has not been received from the publisher. Four methods of estimating the parameters underlying married women's labor supply function are examined in order to deal with the problem that no market wage is observed for women who do not work. The implicit restrictive assumptions concerning the disturbance structure of two conventional empirical approaches are brought to light. Gronau's approach of estimating reservation wages is compared with conventional methods and judged to be inferior on methodological grounds. Empirical comparisons are made among the two conventional methods and Heckman's 1974 maximum likelihood method. Large and systematic differences in the estimated parameters of the hours of work equation are found between Heckman's approach and the conventional procedure of using only the subsample of working women. Systematic, but relatively small differences in estimated hours of work parameters are found between Heckman's method and an alternative conventional approach of imputing wages to all women and estimating the hours of work equation over the entire sample of observation. Comparisons of predictions among the various are discussed as well as the differences in estimated wage effects. If the estimates are used to predict reservation wages (for use as an estimate of the value of time) or labor force participation rates, the small differences between the two approaches suggest that the simpler and cheaper conventional approach may be preferred. |
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Bibliography Citation
Cogan, John F. "Married Women's Labor Supply: A Comparison of Alternative Estimation Procedures" In: Female Labor Supply: Theory and Estimation. JP Smith, ed., Princeton, NJ: Princeton University Press, 1980: 90-118
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