Income taxation, labour supply and housework

A discrete choice model for French couples

Jan Kabatek, A.H.O. van Soest, E.G.F. Stancanelli

Research output: Contribution to journalArticleScientificpeer-review

Abstract

Earlier studies suggest that income taxation may affect not only labour supply but also domestic work. Here we investigate the impact of income taxation on partners' labour supply and housework, using data for France that taxes incomes of married couples jointly. We estimate a household utility model in which the marginal utilities of leisure and housework of both partners are modelled as random coefficients, depending on observed and unobserved characteristics. We conclude that both partners' market and housework hours are responsive to changes in the tax system. A policy simulation suggests that replacing joint taxation of married spouses' incomes with separate taxation would increase the husband's housework hours by 1.3% and reduce his labour supply by 0.8%. The wife's market hours would increase by 3.7%, and her housework hours would fall by 2.0%.
Original languageEnglish
Pages (from-to)30-43
JournalLabour Economics
Volume27
DOIs
Publication statusPublished - Apr 2014

Keywords

  • Time use
  • Taxation
  • Discrete choice models

Cite this

@article{ce7d2ab5e5db40cabdac6d6ab8fdee29,
title = "Income taxation, labour supply and housework: A discrete choice model for French couples",
abstract = "Earlier studies suggest that income taxation may affect not only labour supply but also domestic work. Here we investigate the impact of income taxation on partners' labour supply and housework, using data for France that taxes incomes of married couples jointly. We estimate a household utility model in which the marginal utilities of leisure and housework of both partners are modelled as random coefficients, depending on observed and unobserved characteristics. We conclude that both partners' market and housework hours are responsive to changes in the tax system. A policy simulation suggests that replacing joint taxation of married spouses' incomes with separate taxation would increase the husband's housework hours by 1.3{\%} and reduce his labour supply by 0.8{\%}. The wife's market hours would increase by 3.7{\%}, and her housework hours would fall by 2.0{\%}.",
keywords = "Time use, Taxation, Discrete choice models",
author = "Jan Kabatek and {van Soest}, A.H.O. and E.G.F. Stancanelli",
year = "2014",
month = "4",
doi = "10.1016/j.labeco.2014.01.004",
language = "English",
volume = "27",
pages = "30--43",
journal = "Labour Economics",
issn = "0927-5371",
publisher = "Elsevier Science BV",

}

Income taxation, labour supply and housework : A discrete choice model for French couples. / Kabatek, Jan; van Soest, A.H.O.; Stancanelli, E.G.F.

In: Labour Economics, Vol. 27, 04.2014, p. 30-43.

Research output: Contribution to journalArticleScientificpeer-review

TY - JOUR

T1 - Income taxation, labour supply and housework

T2 - A discrete choice model for French couples

AU - Kabatek, Jan

AU - van Soest, A.H.O.

AU - Stancanelli, E.G.F.

PY - 2014/4

Y1 - 2014/4

N2 - Earlier studies suggest that income taxation may affect not only labour supply but also domestic work. Here we investigate the impact of income taxation on partners' labour supply and housework, using data for France that taxes incomes of married couples jointly. We estimate a household utility model in which the marginal utilities of leisure and housework of both partners are modelled as random coefficients, depending on observed and unobserved characteristics. We conclude that both partners' market and housework hours are responsive to changes in the tax system. A policy simulation suggests that replacing joint taxation of married spouses' incomes with separate taxation would increase the husband's housework hours by 1.3% and reduce his labour supply by 0.8%. The wife's market hours would increase by 3.7%, and her housework hours would fall by 2.0%.

AB - Earlier studies suggest that income taxation may affect not only labour supply but also domestic work. Here we investigate the impact of income taxation on partners' labour supply and housework, using data for France that taxes incomes of married couples jointly. We estimate a household utility model in which the marginal utilities of leisure and housework of both partners are modelled as random coefficients, depending on observed and unobserved characteristics. We conclude that both partners' market and housework hours are responsive to changes in the tax system. A policy simulation suggests that replacing joint taxation of married spouses' incomes with separate taxation would increase the husband's housework hours by 1.3% and reduce his labour supply by 0.8%. The wife's market hours would increase by 3.7%, and her housework hours would fall by 2.0%.

KW - Time use

KW - Taxation

KW - Discrete choice models

U2 - 10.1016/j.labeco.2014.01.004

DO - 10.1016/j.labeco.2014.01.004

M3 - Article

VL - 27

SP - 30

EP - 43

JO - Labour Economics

JF - Labour Economics

SN - 0927-5371

ER -