Matlab code for The Labor-Supply Elasticity and Borrowing Constraints: Why Estimates are Biased

By David Domeij, Martin Flodén. 2001

430 citations recorded by the source corpus.

Artificial data: The Matlab code generating the artificial data is available upon request (it is currently a mess - possibly we will eventually find time and spirit to clean it up and put the code here). The artificial data and the matlab code running the regressions on the artificial data is avialble in artificial.zip (8 Mb). This zip file contains the following files: regress_artificial.m (This is the main matlab file), regress.m (Used by regress_artificial), tsls.m (Used by regress), simsav_web.sav (Simulated data for the benchmark specification with separable utility), simsav_web_cd.sav (Simulated data with Cobb Douglas utility function). PSID data: We use SAS to extract raw data from the PSID, and to build text files that can be read by Matlab. The Matlab code then selects the sample and runs the regressions. The raw PSID data is available at the PSID web page. It is clear from our SAS files which PSID files are used. Contents of psid_data8395.zip (0.6 Mb): build_data84.sas (SAS code to read raw 1983-1985 PSID data), data84.asc (Output from build_data84.sas), build_data89.sas (SAS code to read raw 1988-1990 PSID data), data89.asc (Output from build_data89.sas), build_data94.sas (SAS code to read raw 1993-1995 PSID data), data84.asc (Output from build_data94.sas), regress8395.m (Matlab code to process dataXX.asc and to run regressions), Contents of psid_data70s.zip (0.9 Mb): build_data70s.sas (SAS code to read raw 1970-1981 PSID data), data70s_XXX.asc (Output from build_data70s.sas (~ one file per variable)), regress70s.m (Matlab code to process data70s_XXX.asc and to run regressions),

Subfields: Accounting, Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/00cd1eec4e32c3f2792c24575f53f8590e6809b7

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Citations in the corpus

Precautionary Savings or Working Longer Hours (2005, neutral): “The consensus in the profession seemed to be that this elasticity is very low.29 However, as discussed by Domeij and Flodén (2003), estimations that do not take into account the fact that households may be constrained in their borrowing are downward biased.”
Cross-Border Spillovers from Fiscal Stimulus (2009, neutral): “We set μ so that the Frisch elasticity of labor supply is 0.5; see Domeij and Flodén (2006), and assume that households spend one-third of their time working.”
Fiscal Stimulus with Spending Reversals (2009, neutral): “For the Frisch elasticity of labor supply, we assume a value of one-third by setting ϕ = 3 (see Domeij & Flodén, 2006, for recent evidence).”
How Far are We from the Slippery Slope? The Laffer Curve Revisited (2009, neutral): “[15] DOMEIJ D.”
A parsimonious macroeconomic model for asset pricing (2009, positive): “…appendix, I also report the results on asset price dynamics for αn = 12 and find that they are very similar to the case with αn = 6 following Domeij and Floden (2006), who surveyed existing microeconometric studies and argued that part of the reason for the very low estimates is the bias…”
Elimination of Social Security in a Dynastic Framework (2004, background): “Recently, Domeij and Floden (2001) argue that ignoring borrowing constraints biases this parameter downward, by as much as 50%, bringing the elasticity to between 0.3 and 0.56.”
Reconciling Micro and Macro Labor Supply Elasticities: A Structural Perspective (2015, neutral): “Unfortunately , Domeij and Floden ( 2006 ) do not explore implications of their calibrated model for such policies .”
Taxation and Household Labour Supply (2012, background): “Domeij and Floden (2006) results are based upon estimates for married males that control for the 18The contributions considered are those from the Old Age, Survivors and DI programs.”