Labour Supply Responses and the Extensive Margin: The US, UK and France

This paper documents the key stylised facts underlying the evolution of labour supply at the extensive and intensive margins in the last forty years in three countries: United-States, United-Kingdom and France. We develop a statistical decomposition that provides bounds on changes at the extensive and intensive margins. This decomposition is also shown to be coherent with a theoretical analyis the analysis of labour supply elasticities at these margins. We use detailed representative micro-datasets to examine the relative importance of the extensive and intensive in explaining the overall changes in total hours worked. We also present some initial estimates of the broad distribution of implied elasticities at the extensive and intensive margin and their implication for the overall aggregate hours elasticity.