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Altruism with Endogenous Labor Supply

Author

Listed:
  • Fernandes, A.
Abstract
This paper proposes a model of altruism with endogenous labor supply. A full characterization of the family's choices of consumption and leisure is provided. Initially, work effort is assumed to be publicly observed; this assumption is later relaxed, allowing for privately observed actions. It is shown that the ``redistributive neutrality'' property commonly associated with altruism holds only with respect to non-labor income sources. Failing to control for labor income amounts to an inadequate specification of empirical tests of the neutrality hypothesis. Further, when effort is privately observed, the need to convey incentives causes neutrality to break down entirely.

Suggested Citation

  • Fernandes, A., 2000. "Altruism with Endogenous Labor Supply," Papers 0002, Centro de Estudios Monetarios Y Financieros-.
    • Handle: RePEc:fth:cemfdt:0002
    as

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    References listed on IDEAS

    as
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    15. Altonji, Joseph G & Hayashi, Fumio & Kotlikoff, Laurence J, 1997. "Parental Altruism and Inter Vivos Transfers: Theory and Evidence," Journal of Political Economy, University of Chicago Press, vol. 105(6), pages 1121-1166, December.
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    Citations

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    Cited by:

    1. Wolff, Francois-Charles & Laferrere, Anne, 2006. "Microeconomic models of family transfers," Handbook on the Economics of Giving, Reciprocity and Altruism, in: S. Kolm & Jean Mercier Ythier (ed.), Handbook of the Economics of Giving, Altruism and Reciprocity, edition 1, volume 1, chapter 13, pages 889-969, Elsevier.
    2. Jellal, Mohamed & Wolff, François Charles, 2003. "Leaving home as a self-selection device," MPRA Paper 38528, University Library of Munich, Germany.
    3. Ana Fernandes, 2011. "Altruism, labor supply and redistributive neutrality," Journal of Population Economics, Springer;European Society for Population Economics, vol. 24(4), pages 1443-1469, October.
    4. Ernesto Villanueva, 2001. "Parental altruism under imperfect information: Theory and evidence," Economics Working Papers 566, Department of Economics and Business, Universitat Pompeu Fabra, revised Sep 2002.
    5. Jellal, Mohamed, 2009. "A Theory of Educational Inequality Family and Agency Costs," MPRA Paper 17434, University Library of Munich, Germany.
    6. Josep Pijoan-Mas, 2006. "Precautionary Savings or Working Longer Hours?," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 9(2), pages 326-352, April.
    7. Jellal, Mohamed, 2014. "A theory of family education incentives and inequality," MPRA Paper 57913, University Library of Munich, Germany.

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    More about this item

    Keywords

    ALTRUISM ; ASYMETRIC INFORMATION ; LABOUR MARKET;
    All these keywords.

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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