Hours risk and wage risk: repercussions over the life cycle

Artikel

We decompose earnings risk into contributions from hours and wage shocks. To distinguish between hours shocks, modeled as innovations to the marginal disutility of work, and labor supply reactions to wage shocks, we formulate a life‐cycle model of consumption and labor supply. For estimation, we use data on married American men from the Panel Study of Income Dynamics. Permanent wage shocks explain 31 percent of total risk, permanent hours shocks 21 percent. Progressive taxation attenuates cross‐sectional earnings risk, but its life‐cycle insurance impact is much smaller. At the mean, a one‐standard‐deviation hours shock raises lifetime income by 11 percent, a wage shock by 13 percent.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Journal: The Scandinavian Journal of Economics ; ISSN: 1467-9442 ; Volume: 125 ; Year: 2023 ; Issue: 4 ; Pages: 956-996 ; Hoboken, NJ: Wiley

Klassifikation und Themen

• Klassifikation: Wirtschaft
• Thema: Labor supply ; earnings risk ; structural estimation ; progressive taxation ; consumption insurance

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Jessen, Robin ; König, Johannes
• Ereignis: Veröffentlichung
• (wer): Wiley
• (wo): Hoboken, NJ
• (wann): 2023

Weitere Informationen

• DOI: doi:10.1111/sjoe.12532
• Letzte Aktualisierung: 10.03.2025, 11:42 MEZ