Mars 2001 | Pierre-André Chiappori, Bernard Fortin, Guy Lacroix
This paper presents a theoretical framework to analyze the impact of the marriage market and divorce legislation on household labor supply. The authors define "distribution factors" as variables that influence the bargaining position of spouses but do not affect individual preferences or joint consumption. They extend Chiappori's collective labor supply model to incorporate these distribution factors, showing that the model imposes new restrictions on labor supply functions and facilitates the identification of individual preferences and the intra-household decision process. The model is estimated using PSID data for 1988, and the results support the theoretical predictions. Specifically, the sex ratio and divorce laws favorable to women significantly affect labor supply behavior and decision processes, aligning with the theory's predictions. The study also provides a method to interpret the welfare consequences of these factors in terms of intra-household transfers.This paper presents a theoretical framework to analyze the impact of the marriage market and divorce legislation on household labor supply. The authors define "distribution factors" as variables that influence the bargaining position of spouses but do not affect individual preferences or joint consumption. They extend Chiappori's collective labor supply model to incorporate these distribution factors, showing that the model imposes new restrictions on labor supply functions and facilitates the identification of individual preferences and the intra-household decision process. The model is estimated using PSID data for 1988, and the results support the theoretical predictions. Specifically, the sex ratio and divorce laws favorable to women significantly affect labor supply behavior and decision processes, aligning with the theory's predictions. The study also provides a method to interpret the welfare consequences of these factors in terms of intra-household transfers.