Cover: Labor Supply with Time and Money Costs of Participation

Labor Supply with Time and Money Costs of Participation

Published 1977

by John F. Cogan


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An analysis of the effects of fixed costs of labor market participation on the labor supply behavior of married women. Both a model of labor force behavior with fixed costs of work and a statistical approach to estimating labor supply functions when such costs are present are developed. The principal finding is that the costs of work are of prime importance in determining the labor supply behavior of married women. For the average woman in the data, the minimum number of hours that she is willing to supply to the labor market are about 1300 per year, and the estimated annual cost of her participation is almost $1000, measured in 1966 dollars. This cost represents about 28 percent of her average earnings.

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