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Analysis of Labour Supply Function for Self Employed Workers

Rushidan Islam Rahman

 

Abstract

Labour supply of self employed workers needs separate analysis from the labour supply of wage workers because the market wage rate may not represent an opportunity cost for the first group. This received inadequate attention as the studies on family enterprises focussed their attention on allocation of total family labour input rather than an individual worker’s labour input. Empirical studies did not properly rake into account the distinction between self employment labour supply and wage employment and/or the presence of multiple workers in the family enterprises. The present study estimated labour supply function of male and female workers engaged in family enterprises financed by the Grameen Bank of Bangladesh. It is observed that the characteristics of the family and the enterprise influence male and female labour supply functions in different directions and in varying magnitudes.

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