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Title: |
The Intertemporal Substitution Hypothesis: A
Quantitative Reassessment |
| Author: |
Lee, Jisoon |
| Author
Affiliation: |
Seoul U |
| Source: |
International Economic Journal, Winter 1987, v. 1, no. 4, pp. 77-99 |
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Publication Date: |
Winter 1987 |
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Abstract: |
This paper reexamines the empirical
validity of the intertemporal substitution hypothesis by reinterpreting
existing empricial labor supply studies. A dynamic labor supply model is
proposed and is used as a unifying framework for various studies.
Evidence discernible from those reinterpretations supports the view that
a typical worker increases working hours in response to a wage increase
perceived to be transitory, but decreases working hours in response to a
permanent wage increase. Specifically, the evidence strongly suggests
that the short run labor supply elasticity exceeds 1. |
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