Estimation and testing of household labour demand models: Evidence from Spain

This paper provides an empirical contribution to the debate about the choice of the most appropriate model to analyse the labour supply decisions of multiperson households. I propose a parametric specification for couples’ labour supply which allows for testing both the unitary model and the collective model. I also test the distribution factor independence of outcomes using differences in the education level between spouses as a distribution factor. The results based on Spanish data from the ECHP show that household labour supply outcomes are distribution factor dependent and that neither the unitary model nor the collective one fits these data.