TY  - RPRT
        AU  - Danzer, Alexander M.
        TI  - Labor Supply and Consumption Smoothing When Income Shocks Are Non-Insurable
        PY  - 2011/Feb/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 5499
        UR  - https://www.iza.org/index.php/publications/dp5499
        AB  - The paper investigates how employees use secondary employment to smooth out consumption shortfalls from non-anticipated wage shocks in their main employment. The identification strategy exploits surprising changes in firms’ wage payment and repayment behavior in Ukraine. Based on unique nationally representative panel data, the econometric approach accounts for workers' unobserved heterogeneity and measurement error in the wage shock information. The estimated labor supply responses suggest that secondary activities are used as temporary coping strategies against wage shocks and that they closely follow the lifecycle of wage arrears. Households that engage in secondary employment can successfully smooth their consumption. The results are robust to several alternative hypotheses concerning the observed labor supply pattern.
        KW  - subsidiary farming
KW  - consumption smoothing
KW  - wage shock
KW  - dual job holding
KW  - reaction time to shocks
        ER  -