Labor supply after transition: evidence from the Czech Republic

0363498 - NHÚ 2012 RIV CZ eng J - Journal Article
Bičáková, Alena - Slačálek, J. - Slavík, M.
Labor supply after transition: evidence from the Czech Republic.
Finance a úvěr-Czech Journal of Economics and Finance. Roč. 61, č. 4 (2011), s. 327-347. ISSN 0015-1920. E-ISSN 0015-1920
Institutional research plan: CEZ:AV0Z70850503
Keywords : labor supply * transition * welfare system
Subject RIV: AH - Economics
Impact factor: 0.346, year: 2011
http://journal.fsv.cuni.cz/storage/1217_str_327_347_-_slacalek.pdf

We extend the scarce evidence on the labor supply in post-transition countries by estimating the wage elasticity of labor force participation in the Czech Republic. Using household income survey data, we find that a one-percent rise in the gross wage increases the probability of working by 0.16 and 0.02 percentage points for women and men, respectively. Taking into account the tax and benefit system, these semi-elasticities fall to 0.06 for women and 0.01 for men. We interpret the difference between the estimates from the two specifications as a summary measure of the welfare system disincentives. The estimated wage elasticities lie at the lower end of the range of values reported for mature market economies. This finding is consistent with the stylized fact that the labor supply in countries with high labor force participation rates, such as the Czech Republic, tends to be less sensitive to wages.
Permanent Link: http://hdl.handle.net/11104/0199336