We show how non-parametric flexibility can be attained in a structural labour supply model that can be used to analyse all sorts of (non-linear) tax and benefits reforms. The direct utility function is approximated with a series expansion. For given length of the expansion, the model is...

The thesis covers three topics on the labour market and on consumer demand. Chapters two and three focus on the labour market mobility and wage differentials between the formal sector and the informal sector in urban Mexico. Dynamic random effects panel data models are used in the analysis....