Intertemporal Labor Supply Effects of Tax Reforms
AbstractIn the year 2000, the German government passed the most ambitious tax reform in post-war German history aiming at a significant tax relief for households. One central aim of this tax reform was to improve work incentives and, thereby, foster employment. In this paper, I estimate an intertemporal discrete choice model of female labor supply that allows to analyze the behavioral effects of the tax reform on the labor supply of married and cohabiting women over time. Using the Markov chain property, I analyze the dynamics of labor supply behavior and derive the short- and long-run labor supply effects of the tax reform.
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Bibliographic InfoPaper provided by DIW Berlin, German Institute for Economic Research in its series Discussion Papers of DIW Berlin with number 669.
Length: 24 p.
Date of creation: 2007
Date of revision:
Publication status: Forthcoming in: Empirical Economics (2013)
Intertemporal labor supply of married women; tax reform; Panel data; microsimulation;
Find related papers by JEL classification:
- C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
- H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
- H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
- J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-03-10 (All new papers)
- NEP-DCM-2007-03-10 (Discrete Choice Models)
- NEP-PBE-2007-03-10 (Public Economics)
- NEP-PUB-2007-03-10 (Public Finance)
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