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In-School Work Experience, Parental Allowances, and Wages

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  • Dustmann, Christian

    (University College London)

  • Micklewright, John

    (University College London)

  • van Soest, Arthur

    (Tilburg University)

Abstract

In many industrialised countries, teenagers have a significant spending power, and they are important customers for specialised industries. The income of teenagers still in full time education comes from two major sources: parental pocket money, and earnings from part time jobs. Little is known about the way these sources interact, and how they depend on parental, school and family characteristics. In this paper, we analyse labour supply of 16 year old British teenagers together with the cash transfers made to them by their parents. We develop a theoretical model, which serves as a basis for the empirical specification in which labour supply and transfers are jointly determined. We estimate this model using unique data on labour supply of teenagers, the wages they receive, and transfers made to them by their parents. We show how these two processes depend on each other, and how transfers and labour supply react to changes in wages.

Suggested Citation

  • Dustmann, Christian & Micklewright, John & van Soest, Arthur, 2004. "In-School Work Experience, Parental Allowances, and Wages," IZA Discussion Papers 1235, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp1235
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    References listed on IDEAS

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    Cited by:

    1. repec:ebl:ecbull:v:9:y:2008:i:13:p:1-10 is not listed on IDEAS
    2. François-Charles Wolff & Christine Barnet-Verzat, 2008. "Pocket money and child effort at school," Economics Bulletin, AccessEcon, vol. 9(13), pages 1-10.
    3. Charlene Kalenkoski & Sabrina Pabilonia, 2010. "Parental transfers, student achievement, and the labor supply of college students," Journal of Population Economics, Springer;European Society for Population Economics, vol. 23(2), pages 469-496, March.
    4. Lahav, Eyal & Benzion, Uri & Shavit, Tal, 2010. "Subjective time discount rates among teenagers and adults: Evidence from Israel," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 39(4), pages 458-465, August.

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    More about this item

    Keywords

    intra-household transfers; teenager labour supply;

    JEL classification:

    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
    • C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions

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