Studies on Household Labor Supply and Home Production

Abstract

This thesis consists of four self-contained empirical studies on different topics in labor economics based on the Swedish data. Short summaries on each paper are given below:

Paper [1]: The aim is to construct models for predicting hourly wage rates and household labor supply for a dynamic microsimulation model, Sesim. The models are estimated using large Swedish register-based data. Wages are modeled utilizing the panel property of the data. In modeling labor supply, the complete tax and social security systems are taken into account. The motivation is to have a tool for analyzing the effects of changes in economic policies upon labor supply.

Paper [2]: The purpose of the paper is to analyze the incentive effects created by the Swedish tax and transfer schemes. We focus on single mother households, and estimate a model that includes both labor supply and welfare participation decisions. We find that there is a significant stigma-effect associated with social welfare participation. The results from the implemented policy simulations show rather large average incentive effects. However, there are some substantial differences when comparing the incentive effects between the lowest and highest income deciles.

Paper [3]: The paper analyzes Swedish time use data from 1993 within the household production theory framework. This study provides a continuation of an earlier study applying the 1984 data. The purpose is to analyze changes in household production of two-earner Swedish households. The stability of the results confirms that the previously suggested specification provides a powerful tool to identify and estimate household production. One of the main findings is that the household marginal productivity profiles have become more alike between females and males. Further, men's and women's household times are found to be q-substitutes.

Paper [4]: The paper is a cross-country study on career interruptions due to parental leave of Danish and Swedish mothers. The aim is to analyze the effects that different family policy regimes have on mothers' job retention. Since there are comparable longitudinal data available we estimate parallel models across the two countries. Our results show that economic incentives affect the decision to resume employment. However, the parental leave mandates as such are very important determinants for the observed behavior.