Title: Nonparametric analysis of household labor supply: Goodness-of-fit and power of the unitary and the collective model
Authors: Cherchye, Laurens ×
Vermeulen, Frederic #
Issue Date: May-2008
Series Title: Review of economics and statistics vol:90 issue:2 pages:267-274
Abstract: We compare the empirical performance of the unitary and the collective approach to modelling observed labour supply behaviour. Deviating from the mainstream literature, we conduct a nonparametric analysis, which avoids the distortive impact of an erroneously specified functional form for the preferences and/or the intrahousehold bargaining process. Our analysis specifically focuses on the goodness-of-fit of the two behavioural models. To guarantee a fair comparison, we complement this goodness-of-fit analysis with a power analysis. Our results strongly favour the collective approach to modelling the behaviour of multi-person households. More generally, they illustrate the usefulness of nonparametric testing tools for the empirical evaluation of theoretical behavioural models.
ISSN: 0034-6535
Publication status: published
KU Leuven publication type: IT
Appears in Collections:Department of Economics, Leuven - miscellaneous
Research Center of Public Economics, Leuven
× corresponding author
# (joint) last author

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