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Kwacha Gonna Do? Experimental Evidence about Labor Supply in Rural Malawi

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  • Jessica Goldberg

Abstract

I use a field experiment to estimate the wage elasticity of employment in the day labor market in rural Malawi. Once a week for 12 consecutive weeks, I make job offers for a workfare-type program to 529 adults. The daily wage varies from the tenth to the ninetieth percentile of the wage distribution, and individuals are entitled to work a maximum of one day per week. In this context (the low agricultural season), 74 percent of individuals worked at the lowest wage, and consequently the estimated labor supply elasticity is low (0.15), regardless of observable characteristics. (JEL C93, J22, J31, O15, O18, R23)

Suggested Citation

  • Jessica Goldberg, 2016. "Kwacha Gonna Do? Experimental Evidence about Labor Supply in Rural Malawi," American Economic Journal: Applied Economics, American Economic Association, vol. 8(1), pages 129-149, January.
    • Handle: RePEc:aea:aejapp:v:8:y:2016:i:1:p:129-49
    Note: DOI: 10.1257/app.20130369
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    References listed on IDEAS

    as
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    More about this item

    JEL classification:

    • C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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