By Mark R. Killingsworth
Hard work offer is a survey of and important advisor to contemporary theoretical and empirical paintings on hard work provide versions, either static and dynamic. The chapters on fresh empirical reports and on dynamic versions are of specific curiosity, simply because neither subject has up to now been mentioned in any aspect in regular texts. built-in inside this survey is an intensive dialogue of public coverage matters in terms of hard work offer, together with source of revenue move courses, comparable to welfare and Social protection, and the source of revenue tax method. A concluding bankruptcy discusses secular traits in exertions offer within the U.S. economic system, particularly the long-run elevate in lady exertions strength participation.
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Additional resources for Labor Supply (Cambridge Surveys of Economic Literature)
Sixth, another technical matter: The labor supply function for a given individual may be written as / / = //( W, V, P) or, because of the absence of money illusion, more compactly as H = //( W/P, V/P). This defines the optimal or utility-maximizing level of labor supply. 10 Moreover, utility is simply u = u(C,L), or, because// + principle, almost anything is possible, and what appears there is simply one possibility. 10 Note that these functions refer to a given individual and that the shapes of these functions will differ from one individual to another because different individuals have different tastes.
Cw/), L,is the amount of leisure or nonmarket time devoted to production of activity /, and Cjt is the amount of they th consumer good devoted to production of activity /. Clearly, the production of Zt entails not only a direct or money cost (that is, purchases of the market goods used to produce Z,) but also an indirect or forgone-earnings cost (because time must be 9 Their work has since been extended by Altman and Barro (1971), Boskin (1974), Fisher (1971), Ghez and Becker (1975), Gronau (1973a-c), Landsberger (1971, 1973), Leibowitz (1974), Owen (1969, 1971), and Smith (1973).
As all this suggests, marital status and labor supply are closely related. Indeed, a change in marital status is often tantamount to and accompanied by - a change in labor supply; and in a fundamental sense marital status and labor supply may be determined jointly, through a process of optimization more general than any described above. Some work on this issue has begun (see, for example, Becker, 1974, 1981), but to date no fully developed model of this kind exists. The relevance of such issues to empirical and public policy questions is, of course, considerable.