This paper examines the computation of welfare measures for use with labour supply models. The standard method of computing compensating and equivalent variations does not allow sufficiently for the nonlinearity of the budget constraint in such models. An alternative method is suggested and...

This paper is concerned with the measurement of individual welfare in labour supply models which allow for the impact of income taxation and income support schemes on labour supply decisions. The paper is motivated by the concern over the need to have measures which can be interpreted easily,...

We introduce a structural model which jointly estimates the full-time wage premium and female labor supply, using the piecewise-linear budget constraint method. Our model incorporates a discontinuous budget line at cut-off hours (35 hours a week), caused by the coexistence of both full- and...