Download now Free registration required
The authors evaluate reforms to the U.S. tax system in a dynamic setup with heterogeneous married and single households, and with an operative extensive margin in labor supply. They restrict the model with observations on gender and skill premia, labor force participation of married females across skill groups, and the structure of marital sorting. They study four revenue-neutral tax reforms: a proportional consumption tax, a proportional income tax, a progressive consumption tax, and a reform in which married individuals file taxes separately. The findings indicate that tax reforms are accompanied by large and differential effects on labor supply: while hours per-worker display small increases, total hours and female labor force participation increase substantially.
- Format: PDF
- Size: 345 KB