How responsive is the labor market to tax policy?

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in ProsEmployment and hours worked are responsive to tax incentives at key points in the life cycle, particularly the early and late stages. Employment and hours worked are also responsive to tax incentives for mothers with young children. Human capital investments extend incentives for lifetime labor supply by boosting wages and keeping them higher longer into old age. eleVaTOR PiTchWith aging populations and increased demands on government revenue, countries need to boost employment and earnings. Tax policy should focus on labor market entry and retirement. Those are the points where labor supply is most responsive to tax incentives, which can enhance the flow into work of people leaving school and women with young children and can prolong employment among older workers. Human capital policy has a complementary role in improving the payoff to work and ensuring that earnings hold up longer over a lifetime. auThOR'S Main MeSSaGeEven before the financial crisis of 2008-2009 many developed economies were struggling to maintain employment and earnings. These problems become even more severe as populations age. The key to extending employment and earnings is to focus policy on improving the flows into work for people leaving school and for mothers with young children, and on expanding work among people in their 50s and 60s. These are the margins where labor supply is most sensitive to tax incentives, and a policy redesign can enhance earnings throughout the working life. consLonger-term payoff to employment is small for people with only basic school qualifications. Part-time work experience seems to have little long-term payoff. Tax and welfare policy is limited without a focus on human capital investments. how responsive is the labor market to tax policy?When applied to the most responsive segments of the labor market, tax policy can increase lifetime earnings and employment

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Taux Marginaux Effectifs D’imposition : Une Comparaison Québec-Ontario

“…La littérature suggère que l'offre de travail est plus sensible aux incitations chez certains sous-groupes de la population : (1) les individus en fin de carrière, (2) les mères de jeunes enfants envisageant un retour sur le marché du travail et (3) les individus à faible niveau d'éducation terminant leurs études. (voir par exemple Mirrlees et Adam, 2011et Blundell, 2014. Les incitations au travail pour ces sous-groupes exigent donc une attention particulière.…”

The Looming Central and Eastern European Real Convergence Club. Do Implicit Tax Rates Play a Part?

“…There have been extensive debates concerning the manner in which the tax burden has been proxied in macroeconomic studies (either as tax rate or tax wedge), but conclusions show that though they considerably differ, the correlation is high (de Haan et al, 2003). The ITR on labour is regarded as an incentive towards work and highly related to employment and working hours, mainly in the early and late stages of income life cycle, though the issue is treated separately according to gender, age and family responsibilities (Blundell, 2014). The impact of taxes on wages and unemployment depend on how wages are set, as well as welfare and unemployment benefits.…”