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How does intrahousehold bargaining power impact labor supply? European cross-country evidence (2004-2019)

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  • Belloc, Ignacio
  • Molina, José Alberto
  • Velilla, Jorge

Abstract

This paper analyzes how intrahousehold bargaining power impacts labor supply, for seventeen European countries. To that end, we estimate a collective model using the European Union Statistics on Income and Living Conditions for the period 2004-2019, and we study the validity of several potential distribution factors; that is to say, variables that impact labor supply only through intrahousehold bargaining power. Results show some degree of heterogeneity in the responses of labor supply to intrahousehold bargaining power. Spouses' education and the age gap operate as distribution factors in central European countries, such as Austria, Belgium, France, Luxembourg, and Switzerland. On the other hand, in the Mediterranean South countries, the share of unearned income of the wife operates as a distribution factor in Italy, Portugal, and Spain, and in countries of Eastern Europe (Czech Republic, Hungary, Latvia, and Lithuania), the sex ratio, wives' non-labor income share, spouses' age and education gap, and the fertility rate all operate as distribution factors. In northern economies, such as Denmark and Estonia, we find evidence for share of unearned income, age gap, and fertility rate, while in islands, such as Ireland and the United Kingdom, the sex ratio, the share of unearned income, the age and education gap, and the fertility rate are suitable bargaining power variables. The results are consistent with theoretical sharing rules, and distribution factors that empower a given spouse are mainly positively correlated with increases in the share of income they attract from intrahousehold bargaining.

Suggested Citation

  • Belloc, Ignacio & Molina, José Alberto & Velilla, Jorge, 2022. "How does intrahousehold bargaining power impact labor supply? European cross-country evidence (2004-2019)," GLO Discussion Paper Series 1132, Global Labor Organization (GLO).
    • Handle: RePEc:zbw:glodps:1132
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    More about this item

    Keywords

    household labor supply; collective model; distribution factors; EU-SILC;
    All these keywords.

    JEL classification:

    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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