This paper is the first attempt to estimate the determinants of holiday-taking across several countries. To accomplish this a two-stage estimation procedure is employed which enables incongruous income categories to be transformed into a single income variable. It is found that in the mid-1980s there was a substantial similarity in the holiday taking behaviour of Europeans. The large national differences in holiday participation are explained by differences in income and demographic factors. A remarkable regularity in the responsiveness of the probability of holiday taking to marginal changes in income is found.
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As Kaldor points out, a theory that wages depend on business prosperity is not necessarily inconsistent with an observed relation between the rate of change of money wages and unemployment.It is when investment is high that profits are high, and it is in periods of rising total production and rising productivity that profits are rising. Such periods in turn are periods of low unemployment, and also periods of falling unemployment.But, for Kaldor, the observed relation between unemployment and wage changes is not a caasal one ; it does not relate wages to what * This study is part of a wider research project financed by the Ford Foundation. The authors are particularly indebted to Mrs. June Wickins for research and computational assistance, and to Professors Phelps Brown and Phillips for comments and suggestions. We are also indebted to the members of L.S.E. Staff Seminar on Methodology, Measurement and Testing for penetrating criticisms of an earlier
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