<p>The macro-literature insists on a consumption-leisure elasticity of 0 to match the balanced growth fact of constant labor supply. </p>

<p>Is there any paper that tries to evaluate this elasticity using micro-data, <em>for a representative subsample of the population</em>? There are many papers that show that consumption-leisure elasticities are not 0 for most goods, but it can be argued that these studies only use a non-representative sample of the population, and that - with a larger sample - these elasticities are more likely to average out to zero.</p>

<p>What has been done in this respect?</p>

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2016-01-07T14:13:15.073Z
When you say "for a whole generation" do you examining over the life-cycle? That is, how rising income changes the consumption-leisure decision differently for agents of different ages? Or do you mean across all people of a certain age?  I think you mean the latter, something like using a census of consumption and leisure (or at least a more representative sample) choices?
BKay
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2016-01-07T14:20:00.973Z
@BKay Indeed, the latter.
FooBar
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2016-01-07T14:22:14.927Z
Second question, While I'm sure many papers assume this, I'm not sure this is actually a general macroeconomic assumption. Can you document "insists"? I thought the stylized fact was that prime age workers have a near zero elasticity of hours with respect to income but that in wealthier economies people start work older and retire earlier, leading to a gently backward bending lifetime labor supply curve with respect to lifetime income. I thought non-representative agent models with tax and labor complexities allow for labor supply (and therefore cons.) to respond to lifetime wages.
BKay
<macroeconomics><labor-economics><preferences><economic-growth><empirical-evidence>
Consumption-Leisure Elasticity
FooBar
# Consumption-Leisure Elasticity

(Asked by: username_0 on 2015-11-11)

The macro-literature insists on a consumption-leisure elasticity of 0 to match the balanced growth fact of constant labor supply.

Is there any paper that tries to evaluate this elasticity using micro-data, *for a representative subsample of the population*? There are many papers that show that consumption-leisure elasticities are not 0 for most goods, but it can be argued that these studies only use a non-representative sample of the population, and that - with a larger sample - these elasticities are more likely to average out to zero.

What has been done in this respect?

**Tags:** macroeconomics, labor-economics, preferences, economic-growth, empirical-evidence
> **Comments:**
> **username_1**: When you say "for a whole generation" do you examining over the life-cycle? That is, how rising income changes the consumption-leisure decision differently for agents of different ages? Or do you mean across all people of a certain age?  I think you mean the latter, something like using a census of consumption and leisure (or at least a more representative sample) choices?  
> **username_0**: @BKay Indeed, the latter.  
> **username_1**: Second question, While I'm sure many papers assume this, I'm not sure this is actually a general macroeconomic assumption. Can you document "insists"? I thought the stylized fact was that prime age workers have a near zero elasticity of hours with respect to income but that in wealthier economies people start work older and retire earlier, leading to a gently backward bending lifetime labor supply curve with respect to lifetime income. I thought non-representative agent models with tax and labor complexities allow for labor supply (and therefore cons.) to respond to lifetime wages.  

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## 0 answers

