Abstract

MORA, Jhon James. A dynamic analysis of the effect of fortuitous earnings on labor participation. Lect. Econ. [online]. 2007, n.66, pp.213-224. ISSN 0120-2596.

This paper discusses the negative effect that inheritances, gifts or lotteries (which usually can be thought of as fortuitous profits) have on labor participation. This effect is also known in the literature as the Carnegie hypothesis. In order to analyze this effect, this paper considers women from Spain during the period 1994-2000. The results of the panel data for a dynamic probit show that there is a significant negative relationship between labor participation and fortuitous profits, which supports the results of Holtz-Eakin et al. (1993) for the United States.

Keywords : dynamic probit; leisure normality; labor participation; labor market.

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