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The aim of this paper is to analyse the role of unobserved heterogeneity in structural discrete choice models of labour supply for the evaluation of tax-reforms. Within this framework, unobserved heterogeneity has been estimated either parametrically or nonparametrically through random co- efficient models. Nevertheless, the estimation of such mode...
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This paper estimates the effects on earnings of ‘gap years’ between high school and university enrollment. The effect is estimated
by means of standard earnings functions augmented to account for gap years and a rich set of control variables using administrative
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... Edmark et al. (2012) therefore concluded that the limited variation in the size of the tax deduction among individuals in combination with complex employment trends both before and after the EITC reform(s) presented a major challenge to evaluating the employment effects of the Swedish EITC. Therefore, their overall assessment was that their results could not be credibly interpreted as effects of the EITC. 4 To date, no successful ex-post evaluation of the EITC reform using microdata has been carried out, and therefore, only results from ex ante analyses are available (e.g., Ericson et al., 2009). ...
This study examines how the Swedish earned income tax credit (EITC) introduced in 2007 affected the labor supply of men and women living in two-adult households and the extent to which children in the household affected the outcome. Because the EITC is non-targeted in Sweden, it is difficult to form a meaningful comparison group for a regular ex-post quasi-experimental evaluation of the reform. Therefore, a structural discrete choice labor supply model for two-adult households is formulated and used in an ex ante analysis. In a first step, estimates from the structural labor supply model are used to determine the wage elasticities of the labor supply of men and women
separately, both with and without children in the household. Our results correspond to those previously reported in the academic literature: somewhat larger wage elasticities are found for women than for men, while similar labor supply responses are found for men and women when there are no children in the household. In a second step, the labor supply model is used to simulate the labor supply responses to the EITC. Our results indicate that the largest response is on the extensive margin, with an increase in the labor force participation of both men and women. While the labor supply effect on the intensive margin is smaller, it is positive for both men and women working parttime. However, the presence of children affects work hours differently for men and women working part-time or not at all. For men, the percentage change in the work hours was much higher for those living in a household without children, whereas for women, the changes are almost the same for the two types of households.
... With special relevance to our paper, Ericson et al (2009) The idea is to examine the effect of tax progressivity (which has been affected by the introduction of the EITC) and the effect of the net replacement rate in the unemployment insurance. As mentioned above, the latter was reduced at the same time as the introduction of the EITC. ...
... As can be seen from column (4), it turns out that this difference corresponds to a 1.75 percentage point increase in employment in the most preferred specification. This is still a large reform effect, but it is not so much higher than the employment effects found in earlier microsimulations of the same reform (Sacklén, 2009, Ericson et al, 2009). However, we do not want to draw too strong conclusions from the difference between and ˆp lacebo , since it is very unsatisfactory to not understand the nature of the underlying trends.. Table 6 also reports results from estimations where the dependent variable is employment defined as having earnings exceeding one income base amount. ...
Over the last twenty years we have seen an increasing use of in-work tax subsidies to encourage labor supply among low-income groups. In Sweden, a non-targeted earned income tax credit was introduced in 2007, and was reinforced in 2008, 2009 and 2010. The stated motive of the reform was to boost employment; in particular to provide incentives for individuals to go from unemployment to, at least, part-time work. In this paper we try to analyze the extensive margin labor supply effects of the Swedish earned income tax credit reform up to 2008. For identification we exploit the fact that the size of the tax credit, as well as the resulting average tax rate, is a function of the municipality of residence and income if working. However, throughout the analysis we find placebo effects that are similar in size to the estimated reform effects. In addition, the results are sensitive with respect to how we define employment, which is especially true when we analyze different subgroups such as men and women, married and singles. Our conclusion is that the identifying variation is too small and potentially endogenous and that it is therefore not possible to use this variation to perform a quasi-experimental evaluation of the Swedish EITC-reform.
... For a detailed presentation of all models including the estimated parameters, seeEricson, Flood and Wahlberg (2009). ...
This paper presents estimates of individuals' responses in hourly wages to changes in marginal tax rates. Estimates based on register panel data of Swedish households covering the period 1992 to 2007 produce significant but relatively small net-of-tax rate elasticities. The results vary with family type, with the largest elasticities obtained for single males and the smallest for married/cohabitant females. Despite these seemingly small elasticities, evaluation of the effects of a reduced state tax using a microsimulation model shows that the effort effect matters. The largest effect is due to changes in number of working hours yet including the effort effect results in an almost self-financed reform. As a reference to the earlier literature we also estimate taxable income elasticities. As expected, these are larger than for the hourly wage rates. However, both specifications produce significantly and positive income effects.
... The main source of inspiration for the work on ICETAXSIM is a recent tax/ benefit microsimulation model for Sweden, SWEtaxben (Ericson, Flood, & Wahlberg, 2009;). Both models use micro data sets from register-based longitudinal databases that are of similar construct, and both use similar types of econometric models. ...
Í rannsókn þessari var spurt hvort menntun sé metin að verðleikum á vinnumarkaði Vesturlands. Komið hafa fram áhyggjur af því að skólagangi leiði ekki til næjganlegrar hækkunar launa og þess vegna sé menntunarstig vinnuaflsins hérlendis ekki nógu hátt. Ennfremur, að staðan sé mun verri á landsbyggðinni heldur en á höfuðborgarsvæðinu. Þess vegna var ákveðið að kanna hvort vinnumarkaðurinn á Vesturlandi verðlauni skólagöngu einstaklinga í formi launa. Byggt er á skoðanakönnun sem gerð var á Vesturlandi árið 2007. Úrtakið (1400) var nægjanlega stórt til að brjóta upp Vesturland í fjögur mismunandi svæði. Svarhlutfallið var 36%. Aðferð minnstu kvaðrata var beitt við greininguna. Könnunin leiðir í ljós að skólaganga er verðlaunuð á Vesturlandi en þau verðlaun virðast vera mun lægri en gengur og gerist á höfuborgarsvæðinu.
... A number of studies have been conducted on the potential effects of the in-work tax credit. Ericson et al. (2009) evaluated the in-work tax credit and lower level of taxation in the country, and estimated that the employment rate and working hours will increase, while unemployment, sickness, housing, social allowances and disability pension and old age pension will decrease. However, it should be noted that these estimates are premised on the assumption that there is sufficient labour demand. ...
The first two decades of the twenty-first century brought little relief to advanced economies in terms of poverty, inequality, disruptive technological change, and precarious employment. There were only limited reforms to the welfare state, although promising initiatives to integrate social assistance benefits with greater financial incentives to work occurred in France and the U.K., albeit with a continuation of work conditions. Basic income pilot projects have proliferated but appear to lack the focus and documentation that scientific experimentation would require. Research on optimal taxation has led to proposals for a negative income tax in the form of a refundable tax credit that would mirror the Universal Credit implemented in the U.K. but with greater work incentives and no work conditions. Emerging microsimulation modelling provides a promising alternative strategy to evaluate basic income policies.
Informal milk marketing chains provide the major milk supply link from smallholder dairy production systems to consumers in developing countries. Prevalence risk of antibiotic residues was investigated in milk samples (n=528) collected from different levels of informal supply chains in Pakistan from 2012-2013. After screening, all positive samples were further analyzed by High Performance Liquid Chromatography to quantify individual β-lactam residues. Fifteen percent of the total samples were found to be positive for at least one of the antibiotics. All positive samples (81/528) were positive for amoxicillin. Percentage of positive samples for ampicillin and penicillin was 12.1 and 6.4% respectively. Percentages of positive samples collected from farmers, small collectors, large collectors and retailers were 17.5, 15.1, 8.3 and 13.5 respectively. When relating to season of collection 11.3, 10.2, 19.1, 17.9 and 16.3% of samples in autumn, monsoon, spring, summer and winter were found positive. Concentrations of amoxicillin, ampicillin and penicillin in positive samples were 79.5±12.15, 106.6±12.49 and 13.7±4.2µgkg-1 respectively. Occurrence of these high levels of drug residues demand mass awareness programs associated with the implementation of legislation and its enforcement designed to protect the consumer.
This paper presents a new tax benefit microsimulation model for Luxembourg. The main distinguishing feature of the model is that it includes a behavioural module for labour supply. We validate our model by comparing incomes, taxes, and transfers produced with those of EU–SILC and EUROMOD. The labour supply model is validated by studying the fit (comparing observed hours of labour with those predicted by the model). Wage elasticities are reported and compared with similar exercises in the literature. Finally, the model is used for assessing a recent switch of the Luxembourg tax system from joint to individual taxation. By comparing simulated non-behavioural output it is shown that, as a whole, LuxTaxBen produces an output very close to that produced by EUROMOD and EU-SILC. Further, the behavioural simulation suggests that the reform has no impact on the labour supply for males in couple while a significant number of inactive females change their inactivity status and start working due to the reform. It is also shown that the change in the labour income increases by 0.8% while the welfare dependence decreases by −0.6 due to move from joint to individual tax rules.
The number of ever born children is one of the main components of
population dynamics that determine the size, structure, as well as the composition of a countries’ population. Children ever born refer to the number of children born alive to the person up to a specified reference date and served as a response variable here. A secondary dataset is used in this paper that is obtained from a countrywide representative survey entitled Bangladesh Demographic and Health Survey (BDHS)
2014. This study aims to identify the socioeconomic and demographic factors influencing children ever born to the women of 15–49 years old in Bangladesh. The first attempt of this paper is to identify the best-fitted model among generalized Poisson, Negative Binomial, truncated, COM and finite mixture regression model form. The results suggest that among the model considered in this study Finite Mixture Negative Binomial Regression with three components gives the best-fitted model to estimate the number of ever born children in Bangladesh. It reveals that respondents age, residential status, family size and intention of using contraception have shown positive impact and respondents education, drinking water, toilet facility, religious status, household head age, wealth index, age at first birth, and
husband education shows a negative impact on ever born children.
