Also, in my preferred specification, I do not assume that average and marginal values are the same. An average value of $70 (relative to nonexistence) is perfectly compatible with the marginal value of the last hour of leisure (relative to working) to be equal to take-home pay. Assuming equality was just an extreme estimate to set a lower bound on things.
Also, in my preferred specification, I do not assume that average and marginal values are the same. An average value of $70 (relative to nonexistence) is perfectly compatible with the marginal value of the last hour of leisure (relative to working) to be equal to take-home pay. Assuming equality was just an extreme estimate to set a lower bound on things.