Labor Supply and the Value of Non-work Time: Experimental Estimates from the Field
- (pp. 111-26)
Abstract
We estimate the marginal value of non-work time (MVT) using a field experiment. We offered job applicants randomized wage-hour bundles. Choices over these bundles yield estimates of the MVT as a function of hours, tracing out a labor supply relationship. The substitution effect is positive. Individual labor supply is highly elastic at low hours and more inelastic at higher hours. For unemployed applicants, our preferred estimate of the average opportunity cost of a full-time job due to lost leisure and household production is 60 percent of after-tax marginal product, and 72 percent when including fixed costs of employment and child-care costs.Citation
Mas, Alexandre, and Amanda Pallais. 2019. "Labor Supply and the Value of Non-work Time: Experimental Estimates from the Field." American Economic Review: Insights, 1 (1): 111-26. DOI: 10.1257/aeri.20180070Additional Materials
JEL Classification
- C93 Field Experiments
- J22 Time Allocation and Labor Supply
- J24 Human Capital; Skills; Occupational Choice; Labor Productivity
- J31 Wage Level and Structure; Wage Differentials
- J64 Unemployment: Models, Duration, Incidence, and Job Search
- J65 Unemployment Insurance; Severance Pay; Plant Closings