Labor Supply of New York City Cabdrivers: One Day at a Time

@article{Camerer1997LaborSO,
  title={Labor Supply of New York City Cabdrivers: One Day at a Time},
  author={Colin Camerer and Linda Babcock and George Loewenstein and Richard H. Thaler},
  journal={Quarterly Journal of Economics},
  year={1997},
  volume={112},
  pages={407-441}
}
Life-cycle models of labor supply predict a positive relationship between hours supplied and transitory changes in wages. We tested this prediction using three samples of wages and hours of New York City cabdrivers, whose wages are correlated within days but uncorrelated between days. Estimated wage elasticities are significantly negative in two out of three samples. Elasticities of inexperienced drivers average approximately −1 and are less than zero in all three samples (and significantly… 

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