Title

Intertemporal Labor Supply in the Presence of Long Term Contracts

Author(s)

John M. Abowd John Abowd (University of Chicago)

David Card David Card (Princeton University)

Abstract

The authors compare the implications of a symmetric information contracting model and a dynamic labor supply model for changes in earnings and hours. A simple test is whether earnings changes are more variable than hours changes, as predicted by the labor supply model, or less variable, as predicted by the contracting model. The authors apply this test to two longitudinal surveys of adult men and find that earnings are somewhat more variable than hours for men who never change employers. The estimates suggest that changes in earnings and hours not associated with survey measurement error occur at fixed wage rates.

Creation Date

1984-06

Section URL ID

IRS

Paper Number

166

URL

https://dataspace.princeton.edu/bitstream/88435/dsp01gt54kn026/1/166.pdf

File Function

Jel

Keyword(s)

Suppress

false

Series

1