Taxation And Labour Supply
Cross country comparisons of lifecycle labour supplies show that female hours of market work are significantly lower in Australia than in other comparable OECD countries, notably, the US, UK and Sweden. This paper argues that an explanation can be found in the rate structure of the Australian family income tax system, in combination with a poorly developed and costly childcare sector. A detailed analysis of marginal and average tax rates shows how various policy instruments are used to set rates on the income of a second earner, typically the female partner, that reduce her net wage to a level that makes it difficult to finance childcare from the additional income. The system is also shown to be unfair. The paper proposes a return to a progressive individual income tax, with universal family benefits, together with the development of a high quality, education oriented, public sector childcare system.
|Date of creation:||Sep 2007|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +61 2 6125 3807
Fax: +61 2 6125 0744
Web page: http://rse.anu.edu.au/cepr.php
More information through EDIRC
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.:
- Apps, Patricia & Rees, Ray, 2005.
"Gender, Time Use and Public Policy over the Life Cycle,"
IZA Discussion Papers
1855, Institute for the Study of Labor (IZA).
- Patricia Apps & Ray Rees, 2005. "Gender, Time Use, and Public Policy over the Life Cycle," Oxford Review of Economic Policy, Oxford University Press, vol. 21(3), pages 439-461, Autumn.
- Patricia Apps & Ray Rees, 2005. "Gender, Time Use and Public Policy Over the Life Cycle," CEPR Discussion Papers 500, Centre for Economic Policy Research, Research School of Economics, Australian National University.
- Michael J. Boskin & Eytan Sheshinski, 1979.
"Optimal Tax Treatment of the Family: Married Couples,"
NBER Working Papers
0368, National Bureau of Economic Research, Inc.
- Boskin, Michael J. & Sheshinski, Eytan, 1983. "Optimal tax treatment of the family: Married couples," Journal of Public Economics, Elsevier, vol. 20(3), pages 281-297, April.
- Eckstein, Zvi & Wolpin, Kenneth I, 1989. "Dynamic Labour Force Participation of Married Women and Endogenous Work Experience," Review of Economic Studies, Wiley Blackwell, vol. 56(3), pages 375-90, July.
- Apps, Patricia, 1991. "Tax Reform, Population Ageing and the Changing Labour Supply Behaviour of Married Women," Journal of Population Economics, Springer, vol. 4(3), pages 201-16, August.
- Kathryn Shaw, 1994. "The Persistence of Female Labor Supply: Empirical Evidence and Implications," Journal of Human Resources, University of Wisconsin Press, vol. 29(2), pages 348-378.
- Apps, P.F. & Rees, R., 1998.
"On the Taxation of Trade Within and Between Households,"
337, Australian National University - Department of Economics.
- Apps, Patricia & Rees, Ray, 1999. "On the taxation of trade within and between households," Journal of Public Economics, Elsevier, vol. 73(2), pages 241-263, August.
- Altug, Sumru & Miller, Robert A, 1998. "The Effect of Work Experience on Female Wages and Labour Supply," Review of Economic Studies, Wiley Blackwell, vol. 65(1), pages 45-85, January.
When requesting a correction, please mention this item's handle: RePEc:auu:dpaper:560. 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: ()
If references are entirely missing, you can add them using this form.