Female Labour Supply and On-the-Job Search: An Empirical Model Estimated Using Complementary Data Sets

We develop an empirical model of labour supply that is consistent with on-the-job search and which is identified and estimated by combining two data sets: the U.K. Family Expenditure Survey which contains information on income and expenditure and the U.K. Labour Force Survey, which has data on hours and job search behaviour. We provide statistical evidence on the compatibility of the two samples for the purposes of estimating our model. We find that search has a direct negative effect on hours of work and we establish a strong positive effect of wages on hours.