Why Are Mothers Working Longer Hours in Austria than in Germany? A Comparative Microsimulation Analysis
Labour force participation rates of mothers in Austria and Germany are similar; however, full-time employment rates are much higher among Austrian mothers. In order to find out to what extent these differences can be attributed to differences in the tax-transfer system, we perform a comparative microsimulation exercise. After estimating structural labour supply models for both countries, we interchange two important institutional characteristics of the two countries - namely, (i) the definition of the tax unit within the personal income tax and (ii) the parental leave benefit scheme. As our analysis shows, differences in mothers'employment patterns can partly be explained by the different tax systems: while Germany has a system of joint taxation with income splitting for married couples, Austria taxes everyone individually, which leads to lower marginal tax rates for secondary earners than in the German system. Copyright 2007 Institute for Fiscal Studies.
Volume (Year): 28 (2007)
Issue (Month): 4 (December)
|Contact details of provider:|| Postal: |
Phone: (+44) 020 7291 4800
Fax: (+44) 020 7323 4780
Web page: http://www.ifs.org.ukEmail:
More information through EDIRC
|Order Information:|| Postal: The Institute for Fiscal Studies 7 Ridgmount Street LONDON WC1E 7AE|
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Viktor Steiner & Katharina Wrohlich, 2006.
"Introducing Family Tax Splitting in Germany: How Would It Affect the Income Distribution and Work Incentives,"
Discussion Papers of DIW Berlin
612, DIW Berlin, German Institute for Economic Research.
- Steiner, Viktor & Wrohlich, Katharina, 2006. "Introducing Family Tax Splitting in Germany: How Would It Affect the Income Distribution and Work Incentives?," IZA Discussion Papers 2245, Institute for the Study of Labor (IZA).
- Richard Blundell & Thomas MaCurdy, 1998.
"Labour supply: a review of alternative approaches,"
IFS Working Papers
W98/18, Institute for Fiscal Studies.
- Katharina Wrohlich, 2005.
"The Excess Demand for Subsidized Child Care in Germany,"
Discussion Papers of DIW Berlin
470, DIW Berlin, German Institute for Economic Research.
- Katharina Wrohlich, 2008. "The excess demand for subsidized child care in Germany," Applied Economics, Taylor & Francis Journals, vol. 40(10), pages 1217-1228.
- Wrohlich, Katharina, 2005. "The Excess Demand for Subsidized Child Care in Germany," IZA Discussion Papers 1515, Institute for the Study of Labor (IZA).
- Viktor Steiner & Katharina Wrohlich, 2004. "Household Taxation, Income Splitting and Labor Supply Incentives: A Microsimulation Study for Germany," Discussion Papers of DIW Berlin 421, DIW Berlin, German Institute for Economic Research.
- Peter Haan, 2006. "Much ado about nothing: conditional logit vs. random coefficient models for estimating labour supply elasticities," Applied Economics Letters, Taylor & Francis Journals, vol. 13(4), pages 251-256.
When requesting a correction, please mention this item's handle: RePEc:ifs:fistud:v:28:y:2007:i:4:p:463-495. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Stephanie Seavers)
If references are entirely missing, you can add them using this form.