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dc.contributor.authorAaberge, Rolfen_US
dc.contributor.authorColombino, Ugoen_US
dc.contributor.authorWennemo, Tomen_US
dc.date.accessioned2006-06-29en_US
dc.date.accessioned2010-07-07T09:10:02Z-
dc.date.available2010-07-07T09:10:02Z-
dc.date.issued2006en_US
dc.identifier.urihttp://hdl.handle.net/10419/33305-
dc.description.abstractDuring the last two decades, the discrete-choice modelling of labour supply decisions has become increasingly popular, starting with Aaberge et al. (1995) and van Soest (1995). Within the literature adopting this approach there are however two potentially important issues that are worthwhile analyzing in their implications and that so far have not been given the attention they might deserve. A first issue concerns the procedure by which the discrete alternatives are selected to enter the choice set. For example van Soest (1995) chooses (non-probabilistically) a set of fixed points identical for every individual. This is by far the most widely adopted method. By contrast, Aaberge et al. (1995) adopt a sampling procedure suggested by McFadden (1978) and also assume that the choice set may differ across the households. A second issue concerns the availability of the alternatives. Most authors assume all the values of hours-of-work within some range [0, H] are equally available. At the other extreme, some authors assume only two or three alternatives (e.g. non-participation, part-time and full-time) are available for everyone. Aaberge et al. (1995) assume instead that not all the hour opportunities are equally available to everyone; they specify a probability density function of opportunities for each individual and the discrete choice set used in the estimation is built by sampling from that individual-specific density function. In this paper we explore by simulation the implications of the procedure used to build the choice set (fixed alternatives vs. sampled alternatives) and of accounting or not accounting for a different availability of alternatives. The way the choice set is represented seems to have little impact on the fitting of observed values, but a more significant and important impact on the out-of-sample prediction performance.en_US
dc.language.isoengen_US
dc.publisherIZA Bonnen_US
dc.relation.ispartofseriesIZA Discussion Papers 1986en_US
dc.subject.jelC51en_US
dc.subject.jelC52en_US
dc.subject.jelH31en_US
dc.subject.jelJ22en_US
dc.subject.ddc330en_US
dc.subject.keywordlabour supplyen_US
dc.subject.keyworddiscrete-choice modelsen_US
dc.subject.keywordquantity constraintsen_US
dc.subject.keywordprediction performanceen_US
dc.titleEvaluating alternative representations of the choice sets in models of labour supplyen_US
dc.typeWorking Paperen_US
dc.identifier.ppn508330262en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungen-
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