"Marginal Employment" and the Demand for Heterogeneous Labour-Elasticity Estimates from a Multi-Factor Labour Demand Model for Germany

Aufsätze referiert extern - Web of Science

Ronny Freier, Viktor Steiner

In: Applied Economics Letters 17 (2010), 12, S. 1177-1182


We develop a structural multi-factor labour demand model which distinguishes between eight labour categories including marginal employment, i.e. low-paying jobs with only a few working hours and partially exempted from employee's social security contributions. Using a new panel data set for Germany, the model is estimated both for the number of workers and total working hours. For unskilled and skilled workers in full-time employment, we find labour demand elasticities similar to previous estimates. Our new estimates of own-wage elasticities for marginal employment range between -0.13 (number of male workers in West Germany) to -1 (working hours for women).

Ronny Freier

Research Associate in the Public Economics Department