A Cohort Analysis of the Association Between Work Hours and Wages Among Men

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SIEPR Discussion Paper 00-009

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Published:

11/1/00

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Abstract:

The results of some recent ingenious labor supply research might appear incompatible with the notion that uncompensated wage elasticities for men are small, perhaps negative. This paper argues there is no incompatibility. The methodology in this recent research results in computing wage responses that come closer to measuring intertemporal wage elasticities than to uncompensated wage elasticities. This is demonstrated in this paper by using pseudo-panel data constructed from the March Current Population Surveys from 1967 to 1998 to measure both intertemporal wage elasticities and uncompensated wage elasticities. The latter appear sensitive to the particular specification of the hours equation.