Traditionally, labour supply data do not include explicit information on hours and wages in secondary job or overtime work. We compare the estimated labour supply responses based on budget constraints reflecting detailed information on wages in overtime work and second job with the estimates based on budget constraints which do not include information on overtime work or second jobs. The estimated elasticities are numerically larger when explicit information on overtime and second fob work is taken into account. Based on the estimations, we simulate the supply responses of a financed Earned-Income-Tax-Credit (EITc) tax reform which has been proposed lately in Denmark.
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Paper provided by Centre for Labour Market and Social Research, Danmark- in its series Papers with number
98-06.
Length: Date of creation: 1998 Date of revision: Handle: RePEc:fth:clmsre:98-06
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Find related papers by JEL classification: C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: General - - - Estimation C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models C24 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Truncated and Censored Models H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
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