Labor Supply and Optimization Frictions: Evidence from the Danish student labor market

Jakob Egholt Søgaard

Labor Supply and Optimization Frictions: Evidence from the Danish student labor market

Bidragets oversatte titel: Arbejdsudbud og optimiseringsfriktioner: Empiri fra det danske studenterarbejdsmarked

Jakob Egholt Søgaard

Økonomisk Institut

78 Downloads (Pure)

Abstract

In this paper I investigate the nature of optimization frictions by studying the labor market of Danish students. This particular labor market is an interesting case study as it features a range of special institutional settings that affect students’ incentive to earn income and comparing outcomes across these setting effectively allow you to distinguish between different types of frictions. I find that the considered labor market is significantly affected by optimizations frictions, which masks the bunching at kink points normally associated with a positive labor supply elasticity under standard theory. More concretely I find the dominate optimization friction to be individuals’ inattention about their earnings during the year, while real adjustment cost and gradual learning appears to be of less importance.

Bidragets oversatte titel	Arbejdsudbud og optimiseringsfriktioner: Empiri fra det danske studenterarbejdsmarked
Originalsprog	Engelsk
Udgiver	Economic Policy Research Unit. Department of Economics, University of Copenhagen
ISBN (Elektronisk)	0908‐7745
Status	Udgivet - dec. 2014

Navn	EPRU Working Paper Series
ISSN	0908-7745

Emneord

Det Samfundsvidenskabelige Fakultet
arbejdsudbud
friktioner

Adgang til dokumentet

Labour Supply and Optimization Friction

http://web.econ.ku.dk/eprn_epru/Workings_Papers/WP-2014-02.pdf

Citationsformater

@techreport{de807bb67e74402bb775300e08c2b334,

title = "Labor Supply and Optimization Frictions: Evidence from the Danish student labor market",

abstract = "In this paper I investigate the nature of optimization frictions by studying the labor market of Danish students. This particular labor market is an interesting case study as it features a range of special institutional settings that affect students{\textquoteright} incentive to earn income and comparing outcomes across these setting effectively allow you to distinguish between different types of frictions. I find that the considered labor market is significantly affected by optimizations frictions, which masks the bunching at kink points normally associated with a positive labor supply elasticity under standard theory. More concretely I find the dominate optimization friction to be individuals{\textquoteright} inattention about their earnings during the year, while real adjustment cost and gradual learning appears to be of less importance.",

keywords = "Faculty of Social Sciences, arbejdsudbud, friktioner",

author = "S{\o}gaard, {Jakob Egholt}",

note = "JEL Classification: H21, H24, J22 ",

year = "2014",

month = dec,

language = "English",

series = "EPRU Working Paper Series",

publisher = "Economic Policy Research Unit. Department of Economics, University of Copenhagen",

type = "WorkingPaper",

institution = "Economic Policy Research Unit. Department of Economics, University of Copenhagen",

}

TY - UNPB

T1 - Labor Supply and Optimization Frictions

T2 - Evidence from the Danish student labor market

AU - Søgaard, Jakob Egholt

N1 - JEL Classification: H21, H24, J22

PY - 2014/12

Y1 - 2014/12

N2 - In this paper I investigate the nature of optimization frictions by studying the labor market of Danish students. This particular labor market is an interesting case study as it features a range of special institutional settings that affect students’ incentive to earn income and comparing outcomes across these setting effectively allow you to distinguish between different types of frictions. I find that the considered labor market is significantly affected by optimizations frictions, which masks the bunching at kink points normally associated with a positive labor supply elasticity under standard theory. More concretely I find the dominate optimization friction to be individuals’ inattention about their earnings during the year, while real adjustment cost and gradual learning appears to be of less importance.

AB - In this paper I investigate the nature of optimization frictions by studying the labor market of Danish students. This particular labor market is an interesting case study as it features a range of special institutional settings that affect students’ incentive to earn income and comparing outcomes across these setting effectively allow you to distinguish between different types of frictions. I find that the considered labor market is significantly affected by optimizations frictions, which masks the bunching at kink points normally associated with a positive labor supply elasticity under standard theory. More concretely I find the dominate optimization friction to be individuals’ inattention about their earnings during the year, while real adjustment cost and gradual learning appears to be of less importance.

KW - Faculty of Social Sciences

KW - arbejdsudbud

KW - friktioner

M3 - Working paper

T3 - EPRU Working Paper Series

BT - Labor Supply and Optimization Frictions

PB - Economic Policy Research Unit. Department of Economics, University of Copenhagen

ER -