Flexible Labor Supply Models
by Olivier Bargain
(July 2009)
published in: Economics Letters, 2009, 105 (1), 103-105

Discrete-choice models of labor supply have become very popular for ex ante evaluations of policy reforms as they easily account for non-convex budget sets. We test the constraints imposed in practice on these models and suggest a fully flexible model that significantly improves fit.
Text: See Discussion Paper No. 4281