IDEAS home Printed from https://ideas.repec.org/a/spr/jopoec/v31y2018i4d10.1007_s00148-017-0678-4.html
   My bibliography  Save this article

Constrained vs unconstrained labor supply: the economics of dual job holding

Author

Listed:
  • Chung Choe

    (Hanyang University ERICA Campus)

  • Ronald L. Oaxaca

    (University of Arizona)

  • Francesco Renna

    (University of Akron)

Abstract

This paper develops a unified model of dual and unitary job holding based on a Stone-Geary utility function. The model incorporates both constrained and unconstrained labor supply. Panel data methods are adapted to accommodate unobserved heterogeneity and multinomial selection into six mutually exclusive labor supply regimes. We estimate the wage and income elasticities arising from selection and unobserved heterogeneity as well as from the Stone-Geary Slutsky equations. The labor supply model is estimated with data from the British Household Panel Survey 1991–2008. Among dual job holders, our study finds that the Stone-Geary income and wage elasticities are much larger for labor supply to the second job compared with the main job. When the effects of selection and unobserved heterogeneity are taken account of, the magnitudes of these elasticities on the second job tend to be significantly reduced.

Suggested Citation

  • Chung Choe & Ronald L. Oaxaca & Francesco Renna, 2018. "Constrained vs unconstrained labor supply: the economics of dual job holding," Journal of Population Economics, Springer;European Society for Population Economics, vol. 31(4), pages 1279-1319, October.
    • Handle: RePEc:spr:jopoec:v:31:y:2018:i:4:d:10.1007_s00148-017-0678-4
    DOI: 10.1007/s00148-017-0678-4
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s00148-017-0678-4
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s00148-017-0678-4?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Altonji, Joseph G & Paxson, Christina H, 1988. "Labor Supply Preferences, Hours Constraints, and Hours-Wage Trade-Offs," Journal of Labor Economics, University of Chicago Press, vol. 6(2), pages 254-276, April.
    2. Anders Frederiksen & Ebbe Krogh Graversen & Nina Smith, 2008. "Overtime work, dual job holding, and taxation," Research in Labor Economics, in: Work, Earnings and Other Aspects of the Employment Relation, pages 25-55, Emerald Group Publishing Limited.
    3. Bell, David & Hart, Robert A & Wright, Robert E, 1997. "Multiple Job Holding as a 'Hedge' Against Unemployment," CEPR Discussion Papers 1626, C.E.P.R. Discussion Papers.
    4. Zhongmin Wu & Mark Baimbridge & Yu Zhu, 2009. "Multiple job holding in the United Kingdom: evidence from the British Household Panel Survey," Applied Economics, Taylor & Francis Journals, vol. 41(21), pages 2751-2766.
    5. Smith Conway, Karen & Kimmel, Jean, 1998. "Male labor supply estimates and the decision to moonlight," Labour Economics, Elsevier, vol. 5(2), pages 135-166, June.
    6. Chung Choe & Ronald L. Oaxaca & Francesco Renna, 2018. "Constrained vs unconstrained labor supply: the economics of dual job holding," Journal of Population Economics, Springer;European Society for Population Economics, vol. 31(4), pages 1279-1319, October.
    7. Lee, Lung-Fei, 1983. "Generalized Econometric Models with Selectivity," Econometrica, Econometric Society, vol. 51(2), pages 507-512, March.
    8. Jeffrey M Wooldridge, 2010. "Econometric Analysis of Cross Section and Panel Data," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262232588, April.
    9. Amuedo-Dorantes, Catalina & Kimmel, Jean, 2005. "Moonlighting Behavior over the Business Cycle," IZA Discussion Papers 1671, Institute of Labor Economics (IZA).
    10. Lundborg, Per, 1995. "Job amenity and the incidence of double work," Journal of Economic Behavior & Organization, Elsevier, vol. 26(2), pages 273-287, March.
    11. Susan Averett, 2001. "Moonlighting: multiple motives and gender differences," Applied Economics, Taylor & Francis Journals, vol. 33(11), pages 1391-1410.
    12. Wooldridge, Jeffrey M., 1995. "Selection corrections for panel data models under conditional mean independence assumptions," Journal of Econometrics, Elsevier, vol. 68(1), pages 115-132, July.
    13. Krishnan, Pramila, 1990. "The Economics of Moonlighting: A Double Self-Selection Model: Errata," The Review of Economics and Statistics, MIT Press, vol. 72(4), pages 712-712, November.
    14. Krishnan, Pramila, 1990. "The Economics of Moonlighting: A Double Self-Selection Model," The Review of Economics and Statistics, MIT Press, vol. 72(2), pages 361-367, May.
    15. Foley, M.C., 1997. "Multiple Job Holding in Russia During Economic Transition," Papers 781, Yale - Economic Growth Center.
    16. Catalina Amuedo‐Dorantes & Jean Kimmel, 2009. "Moonlighting Over The Business Cycle," Economic Inquiry, Western Economic Association International, vol. 47(4), pages 754-765, October.
    17. Jean Kimmel & Karen Smith Conway, 1995. "Who Moonlights and Why?: Evidence from the SIPP," Upjohn Working Papers 95-40, W.E. Upjohn Institute for Employment Research.
    18. Christian Dustmann & María Engracia Rochina-Barrachina, 2007. "Selection correction in panel data models: An application to the estimation of females' wage equations," Econometrics Journal, Royal Economic Society, vol. 10(2), pages 263-293, July.
    19. W. David Allen, 1998. "The moonlighting decision of unmarried men and women: Family and labor market influences," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 26(2), pages 190-205, June.
    20. Foley, Mark C., 1997. "Multiple Job Holding in Russia During Economic Transition," Center Discussion Papers 28453, Yale University, Economic Growth Center.
    21. Shishko, Robert & Rostker, Bernard, 1976. "The Economics of Multiple Job Holding," American Economic Review, American Economic Association, vol. 66(3), pages 298-308, June.
    22. Mark C. Foley, 1997. "Multiple Job Holding in Russia During Economic Transition," Working Papers 781, Economic Growth Center, Yale University.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Chung Choe & Ronald L. Oaxaca & Francesco Renna, 2018. "Constrained vs unconstrained labor supply: the economics of dual job holding," Journal of Population Economics, Springer;European Society for Population Economics, vol. 31(4), pages 1279-1319, October.
    2. Choe, Chung & Oaxaca, Ronald L. & Renna, Francesco, 2020. "Income Taxation and Dual Job Labour Supply," IZA Discussion Papers 13107, Institute of Labor Economics (IZA).
    3. Renna Francesco & Oaxaca Ronald L. & Choe Chung, 2023. "Is There a Business Cycle Effect on the Incidence of Dual Job Holding?," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 23(2), pages 443-465, April.
    4. Gregory Gilpin, 2020. "Policy‐Induced School Calendar Changes and Teacher Moonlighting," Southern Economic Journal, John Wiley & Sons, vol. 86(3), pages 989-1018, January.
    5. Gregory Gilpin, 2018. "Policy-induced School Calendar Changes and Teacher Moonlighting," CAEPR Working Papers 2018-009, Center for Applied Economics and Policy Research, Department of Economics, Indiana University Bloomington.
    6. Philipp Lentge, 2022. "Second job holding in Germany – a persistent feature?," Working Paper Series in Economics 416, University of Lüneburg, Institute of Economics.
    7. Kawakami, Atsushi, 2019. "Multiple job holding as a strategy for skills development," Japan and the World Economy, Elsevier, vol. 49(C), pages 73-83.
    8. Merja Kauhanen, 2021. "Multiple job holding in the changing labour market Рevidence from Finland," Working Papers 331, Ty̦n ja talouden tutkimus LABORE, The Labour Institute for Economic Research LABORE.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Georgios A. Panos & Konstantinos Pouliakas & Alexandros Zangelidis, 2014. "Multiple Job Holding, Skill Diversification, and Mobility," Industrial Relations: A Journal of Economy and Society, Wiley Blackwell, vol. 53(2), pages 223-272, April.
    2. Gregory Gilpin, 2018. "Policy-induced School Calendar Changes and Teacher Moonlighting," CAEPR Working Papers 2018-009, Center for Applied Economics and Policy Research, Department of Economics, Indiana University Bloomington.
    3. Baah-Boateng, William & Adjei, Prince & Oduro, Abena, 2013. "Determinants of moonlighting in Ghana: an empirical investigation," MPRA Paper 109702, University Library of Munich, Germany.
    4. Ilias Livanos & Alexandros Zangelidis, 2012. "Multiple Job-holding among Male Workers in Greece," Regional Studies, Taylor & Francis Journals, vol. 46(1), pages 119-135, March.
    5. Zhongmin Wu & Mark Baimbridge & Yu Zhu, 2009. "Multiple job holding in the United Kingdom: evidence from the British Household Panel Survey," Applied Economics, Taylor & Francis Journals, vol. 41(21), pages 2751-2766.
    6. Priscila Casari, 2010. "Labor Supply in Brazil: an Analysis of the Second Job in the Urban and Rural Areas," Working papers - Textos para Discussao do Curso de Ciencias Economicas da UFG 019, Curso de Ciencias Economicas da Universidade Federal de Goias - FACE.
    7. Helen Robinson & Jonathan Wadsworth, 2007. "Impact Of The Minimum Wage On The Incidence Of Second Job Holding In Britain," Scottish Journal of Political Economy, Scottish Economic Society, vol. 54(4), pages 553-574, September.
    8. Alison Preston & Robert E. Wright, 2020. "Exploring the gender difference in multiple job holding," Industrial Relations Journal, Wiley Blackwell, vol. 51(4), pages 301-328, July.
    9. Pouliakas, Konstantinos & Panos, Georgios & Zangelidis, Alexandros, 2009. "The Inter-Related Dynamics of Dual Job Holding, Human Capital and Occupational Choice," MPRA Paper 16859, University Library of Munich, Germany.
    10. Sum Lo Simon Ming, 2023. "Desired work-leisure balance in a partial equilibrium job search model with multiple job holding," IZA Journal of Labor Economics, Sciendo & Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 12(1), pages 1-43, December.
    11. Gregory Gilpin, 2020. "Policy‐Induced School Calendar Changes and Teacher Moonlighting," Southern Economic Journal, John Wiley & Sons, vol. 86(3), pages 989-1018, January.
    12. Andrew Atherton & João R. Faria & Daniel Wheatley & Dongxu Wu & Zhongmin Wu, 2016. "The decision to moonlight: does second job holding by the self-employed and employed differ?," Industrial Relations Journal, Wiley Blackwell, vol. 47(3), pages 279-299, May.
    13. Heineck, Guido & Schwarze, Johannes, 2004. "Fly Me to the Moon: The Determinants of Secondary Jobholding in Germany and the UK," IZA Discussion Papers 1358, Institute of Labor Economics (IZA).
    14. Etienne Lalé, 2019. "Search and Multiple Jobholding," Upjohn Working Papers 19-305, W.E. Upjohn Institute for Employment Research.
    15. Olena Kostyshyna & Etienne Lalé, 2022. "On the evolution of multiple jobholding in Canada," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 55(2), pages 1095-1134, May.
    16. Renna Francesco & Oaxaca Ronald L. & Choe Chung, 2023. "Is There a Business Cycle Effect on the Incidence of Dual Job Holding?," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 23(2), pages 443-465, April.
    17. Lalé, Etienne, 2016. "The Evolution of Multiple Jobholding in the U.S. Labor Market: The Complete Picture of Gross Worker Flows," IZA Discussion Papers 10355, Institute of Labor Economics (IZA).
    18. Renna, Francesco & Oaxaca, Ronald L., 2006. "The Economics of Dual Job Holding: A Job Portfolio Model of Labor Supply," IZA Discussion Papers 1915, Institute of Labor Economics (IZA).
    19. Heather Dickey & Verity Watson & Alexandros Zangelidis, 2011. "Is it all about money? An examination of the motives behind moonlighting," Applied Economics, Taylor & Francis Journals, vol. 43(26), pages 3767-3774.
    20. Amuedo-Dorantes, Catalina & Kimmel, Jean, 2005. "Moonlighting Behavior over the Business Cycle," IZA Discussion Papers 1671, Institute of Labor Economics (IZA).

    More about this item

    Keywords

    Dual job; Labor supply; Stone-Geary; Hours constraint;
    All these keywords.

    JEL classification:

    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J49 - Labor and Demographic Economics - - Particular Labor Markets - - - Other

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:jopoec:v:31:y:2018:i:4:d:10.1007_s00148-017-0678-4. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.