A MICROECONOMETRIC COMPARISON OF HOUSEHOLD BEHAVIOR BETWEEN COUNTRIES

This article reviews the methodological issues associated with estimat ing and testing competitive markets with panel data and applies it to an important new arena, international economics. We investigate differ ences in housing consumption and male labor supply across households i n Germany and the United States with data from the German Socio Econom ic Panel and the Panel Study of Income Dynamics. Observations are trea ted as equilibrium outcomes, generated by a set of competitive markets that accommodate varying degrees of integration. After controlling fo r differences in the sample populations and aggregate shocks, we find that the estimated structural parameters are surprisingly similar acro ss these two countries.