Commitment and the dynamics of household labour supply

Alexandros Theloudis; Jorge Velilla; P.A. Chiappori; J. Ignacio Gimenez-Nadal; Jose Alberto Molina

doi:10.1093/ej/ueae065

Commitment and the dynamics of household labour supply

Alexandros Theloudis, Jorge Velilla, P.A. Chiappori, J. Ignacio Gimenez-Nadal, Jose Alberto Molina

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Abstract

The extent to which individuals commit to their partner for life has important implications. This paper develops a life-cycle collective model of the household, through which it characterises behaviour in three prominent alternative types of commitment: full, limited and no commitment. We propose a test that distinguishes between all three types based on how contemporaneous and historical news affect household behaviour. Our test permits heterogeneity in the degree of commitment across households. Using recent data from the Panel Study of Income Dynamics, we reject full and no commitment, while we find strong evidence for limited commitment.

Original language	English
Pages (from-to)	354-386
Number of pages	33
Journal	Economic Journal
Volume	135
Issue number	665
DOIs	https://doi.org/10.1093/ej/ueae065
Publication status	Published - Jan 2025

Keywords

household behavior
intertemporal choice
commitment
collective model
family labor supply
dynamics
wages
PSID

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10.1093/ej/ueae065

ueae065Accepted author manuscript, 2.47 MBLicence: Taverne

Replication package for: "Commitment and the Dynamics of Household Labour Supply"
Theloudis, A. (Creator), Velilla, J. (Creator), Chiappori, P.-A. (Creator), Giménez-Nadal, J. I. (Creator) & Molina, J. A. (Creator), Zenodo, 27 Jun 2024
DOI: 10.5281/zenodo.12571717, https://zenodo.org/records/12571717
Dataset

Cite this

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abstract = "The extent to which individuals commit to their partner for life has important implications. This paper develops a life-cycle collective model of the household, through which it characterises behaviour in three prominent alternative types of commitment: full, limited and no commitment. We propose a test that distinguishes between all three types based on how contemporaneous and historical news affect household behaviour. Our test permits heterogeneity in the degree of commitment across households. Using recent data from the Panel Study of Income Dynamics, we reject full and no commitment, while we find strong evidence for limited commitment.",

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T1 - Commitment and the dynamics of household labour supply

AU - Theloudis, Alexandros

AU - Velilla, Jorge

AU - Chiappori, P.A.

AU - Gimenez-Nadal, J. Ignacio

AU - Molina, Jose Alberto

PY - 2025/1

Y1 - 2025/1

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AB - The extent to which individuals commit to their partner for life has important implications. This paper develops a life-cycle collective model of the household, through which it characterises behaviour in three prominent alternative types of commitment: full, limited and no commitment. We propose a test that distinguishes between all three types based on how contemporaneous and historical news affect household behaviour. Our test permits heterogeneity in the degree of commitment across households. Using recent data from the Panel Study of Income Dynamics, we reject full and no commitment, while we find strong evidence for limited commitment.

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KW - intertemporal choice

KW - commitment

KW - collective model

KW - family labor supply

KW - dynamics

KW - wages

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DO - 10.1093/ej/ueae065

M3 - Article

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VL - 135

SP - 354

EP - 386

JO - Economic Journal

JF - Economic Journal

IS - 665

ER -

Commitment and the dynamics of household labour supply

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Replication package for: "Commitment and the Dynamics of Household Labour Supply"

Cite this