Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/169418
Authors: 
Vasilev, Aleksandar
Year of Publication: 
2017
Abstract (Translated): 
The purpose of this note is to explore the problem of a non-convex labor supply decision in an economy with reciprocity in labor relations ("gift exchange") a la Danthine and Kurmann (2010), and explicitly perform the aggregation presented in Vasilev (2017) without a formal proof, and thus provide - starting from micro-foundations - the deriva- tion of the expected utility functions used for the aggregate household. We show how lotteries as in Rogerson (1988) can be used to convexify consumption sets, and aggre- gate over individual preferences. With a discrete labor supply decisions, the elasticity of aggregate labor supply increases from unity to infi nity.
Subjects: 
Aggregation
Indivisible Labor
Reciprocity
Non-convexities
JEL: 
E1
J22
J41
Document Type: 
Preprint

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