Household specialization and the labor-supply elasticities of women and men

Abstract

This paper studies gender differences in the elasticity of labor supply in a model of household specialization. We show that household specialization implies larger Frisch elasticities for the partner that specializes in home production. Quantitatively, empirical time-use ratios alone imply differences in the Frisch elasticity between women and men of about 50%. Similar results are obtained for long-run elasticities. However, limited commitment within the household reduces the gender differences in long-run labor-supply elasticities. Our results imply that the elasticity of labor supply is not a deep parameter but can react on, e.g., gender-biased employment subsidies, public child care provision, and divorce laws.