Taxation and labour supply: Evidence from a representative population survey

We study how taxation influences labour supply using a specifically designed representative survey of the German population. First, we investigate whether taxes generally matter for the labour supply decisions of our respondents. Around 41 per cent report taking taxes into consideration, implying that the majority of the German population is unresponsive to taxation. Second, we look at self-reported labour supply adjustments following a recently enacted payroll tax change. Only around 12 per cent of our respondents report an actual labour supply response, but we find evidence of an income, as well as a substitution, effect of the tax change. Our conclusion is that the effects of taxes on labour supply in Germany are likely small. We analyse the correlation with economic and socio-demographic variables and find that the self-employed are relatively more sensitive to taxation and that low interest rates reduce incentives for expanding the labour supply.     

Maternal labour supply and childhood obesity in Canada: evidence from the NLSCY

Abstract.  This paper investigates the socioeconomic factors affecting childhood overweight and obesity in Canada using data from the National Longitudinal Survey of Children and Youth. In particular, I attempt to address the issue of whether an increase in the mother's work intensity is associated with an increase in the risk of the child's becoming overweight or obese. I also attempt to evaluate the causality of this relationship and the mechanisms that might facilitate this link. The results suggest that an increase in the mother's work intensity when she first returned to work in the period after the child's birth and before the child started school is associated with an increase in the risk of the child's becoming overweight or obese later in childhood. Conditional on the mother returning to work in the period between the child's birth and the start of school for the child, a 10-hour increase in the number of hours worked per week when the mother first returned to work is associated with an increase in the probability that the child later becomes overweight or obese that is in the range of 2.5 to 4 percentage points.     

Estimating labour supply responses and welfare participation: Using a natural experiment to validate a structural labour supply model

We estimate an economic model of labour supply and welfare participation using data on single men from Quebec drawn from the 1986 Canadian Census. Detailed budget sets for each work‐welfare combination—accounting for income taxes, tax credits and welfare benefit rules—are derived using a micro‐simulation model. We show that predicted reactions to a welfare reform that took place in 1989 replicate actual changes in labour supply and welfare participation. We also illustrate the advantage of having estimated a structural model by showing how labour supply and welfare participation change when income taxes and benefit levels change.     

Income effects and physician labour supply: evidence from the threshold system in Ontario

Abstract. We examine a reform to the physician threshold system in Ontario that provides a unique opportunity to assess the effect of fee changes on physician behaviour, free from the biases that potentially affect simple time‐series or cross‐section inference. We find that: (1) the income effects of fee changes are small, but significant; (2) the income effect dominates the substitution effect only for a minority of services with relatively low prices and high volumes; and (3) the cross effects of fee changes tend to be significant only for services with relatively high prices and low volumes.     

Determinants of household supply of labour in food-for-work programme in Tigray,Ethiopia

We study the factors that determine the household supply of labour in food-for-work (FFW) projects that seek to address food insecurity and help capital formation in development. Based on data from a survey conducted in 2003 in Tigray, Ethiopia, our probit analysis identifies factors that significantly affect the household decision to participate in FFW programmes. We correct for selection bias, and estimate total and excess supply of FFW labour. Our finding of substantial leakages in targeting that allow relatively well-off households to obtain FFW employment yield important implications for the prevailing FFW wage. We also argue that FFW programmes will be more effective if they are designed to account for geographic heterogeneity in such factors as male to female labour participation differences and the incidence of debilitating diseases.     

The effect of death tax on the labour supply of donors: evidence from TRA97

Exploiting estate tax cuts from the Taxpayer Relief Act of 1997 (TRA97), this paper estimates the effect of death tax on the labour supply of living potential donors. To this end, difference-in-difference with multiple imputation approach is applied to micro-level panel data. This paper finds that the estate tax cuts makes no difference in labour force participation or working hours of potential donors in a statistically meaningful way, although the TRA97 reduces marginal estate tax rates by 37.51% on average. This finding suggests that the death tax causes no meaningful distortion of living potential-donors’ labour supplies at either extensive or intensive margin.     

Teen families,welfare transfers,and the minimum wage: evidence from Canada

Abstract This study evaluates the impacts of welfare transfers and the minimum wage on teen family formation by pooling provincial data from Canada between 1990 and 2005. OLS estimates suggest that welfare transfers have had limited impact on teen births. On the other hand, a 10% increase in the minimum wage is significantly correlated with a 3%–5% rise in teen birth rates. This finding is explained by further regressions, which reveal that an increase in the minimum wage is significantly associated with (1) higher earnings among male teens, (2) an increase in teen marriage rates, and (3) an increase in fertility among married teens but not among unmarried females. Finally, estimates based on the 2003 and 2005 waves of the Canadian Community Health Surveys demonstrate that married teens are more likely to engage in sex as well as unprotected intercourse in comparison with single teens.     

Religious service attendance and labour force status: evidence from survey data using count data methods

I undertake count data estimation with data from the National Longitudinal Survey of Youth 1979 cohort and the Health and Retirement Study to evaluate the relationship between time spent out of the labour force and the frequency of religious service attendance for individuals of working age. I also examine whether being out of the labour force is correlated with the frequency of religious service attendance.

?Results using Poisson fixed-effect and negative binomial estimation suggest that men under age 50 appear to attend religious services less frequently when out of the labour force. I ascribe this finding to younger men’s religious service attendance being related to having work or the pursuit of work. Men between ages 50 and 65 attend religious services less frequently when out of the labour force, which I attribute to serious health problems in later age forcing labour market exiting and reduced frequency of religious service attendance. Women between ages 50 and 65 attend religious services more frequently when out of the labour force, which I ascribe to having more time to pursue religious activity in addition to women’s established proclivity to religious commitment.     

Market potential and welfare: evidence from the Iberian Peninsula

We present a methodology to quantify market potential in the context of an economic geography model. The model is then applied to the NUTS 2 regions of Portugal and Spain. Some results can be pointed out. First, the Iberian Peninsula presents a clear centre-periphery pattern. The market potential pike is situated in the region of Madrid, followed very closely by Cataluña and Pais Vasco. Also all Portuguese regions are at the bottom of the market potential rank, i.e.: Portugal is at the periphery of Spain. Second, the regional welfare index confirms market potential results. There is therefore a direct correlation between market potential and regional welfare. Third, a scenario of complete integration between the Portuguese and the Spanish economy is favourable to the most laggard regions. On the contrary, the most advanced regions of each country loose a little. However, ‘lock-in’ effects allow the most central regions to continue in the forefront of development and welfare.Received: Received: July 2004 / Accepted: January 2005, Accepted: Received: July 2004 / Accepted: January 2005, JEL Classification: C68, F12, F15, R12, R13The author is in debt to Renato Flôres and Paula Fontoura for helpful discussions during the preparation of this work. A first version of this paper was presented at the conference “Portuguese Economic Development in the European Context” organized by the Portuguese Central Bank. I am thankful to José Braga de Macedo, Pedro Duarte Neves and to all participants for very useful observations and comments. This version benefited greatly from the remarks and suggestions by Mahahisa Fujita, Alireza Naghavi and two anonymous referees. I am also in debt to José Pedro Pontes for inviting me to the “Luso-Japanese Workshop in Geographical Economics” and for encouraging me to submit this paper to this special issue of the Portuguese Economic Journal. The research conducted here was supported by a grant from Fundação para a Ciência e a Tecnologia(Praxis XXI/BM/17786/98). The usual disclaimer however applies.     

Effects of health insurance on labour supply: evidence from the health care fund for the poor in Vietnam

The expansion of health insurance in emerging countries raises concerns about the unintended negative effects of health insurance on labour supply. This article examines the labour supply effects of the Health Care Fund for the Poor (HCFP) in Vietnam in terms of the number of work hours per month and labour force participation (the probability of employment). Employing various matching methods combined with a Difference-in-Differences approach on the Vietnam Household Living Standard Surveys 2002–2006, we show that the HCFP, which aims to provide poor people and disadvantaged minority groups with free health insurance, has a negative effect on labour supply. This is manifested in both the average number of hours worked per month and the probability of employment, suggesting the income effect of the HCFP. Interestingly, the effects are mainly driven by the non-poor recipients living in rural areas, raising the question of the targeting strategy of the programme.     

Sexual orientation and labour relations: new evidence from Athens,Greece

We use data from the 2008–2009 Athens Area Study (AAS) to provide the first evidence on the relationship between men's sexual orientation and wages in the Greek capital, Athens. Gay and bisexual men are found to receive significantly lower monthly wages than heterosexual male workers after accounting for demographic and occupational characteristics. The estimations reveal that educated gay and bisexual workers face lower wage differentials than less-educated gay and bisexual workers, which is consistent with the statistical theory of discrimination. However, wage gaps are significant at all educational attainment levels, suggesting that these workers face strong prejudices in the Athenian labour market. The same pattern holds also across all occupations and sectors. Furthermore, to better understand the determinants of the wage gaps, we compare gay/bisexual men with both married and unmarried heterosexual men. By making these comparisons, we are able to disentangle the penalty associated with being unmarried from other human-capital explanations for the wage gap.     

Stunting and academic achievement among Vietnamese children: new evidence from the young lives survey

Most of the empirical literature on the relationship between the health condition and skill development of school children are based on a static relationship between health and skill development. This article contributes to the literature by examining the dynamic relationship between stunting and school achievement using data from the first three waves of the Young Lives Survey in Vietnam. Using both structural equation and hybrid estimators, empirical results show that past school performance is the most significant predictor of the academic performance. Stunting has a significant negative effect on school performance, and its effect in the long run is as twice as much its effect in the short run. The empirical evidence also shows that the age of the child, mothers’ literacy, access to electricity and household consumption significantly affect school performance.     

Household formation rules,fertility and female labour supply: Evidence from post-communist countries

This paper explains how household formation rules affect the fertility and labour supply of women in the Former Soviet Union and neighbouring countries. Women who bear a male first child in countries dominated by traditional, patrilocal households are shown to have substantially lower subsequent fertility from those whose first child is female. Where households are generally nuclear, male first borns do not reduce subsequent fertility. Middle-aged women in more patrilocal contexts often work less if their first child is male, despite reduced fertility and being more likely to reside with a daughter-in-law. In more nuclear contexts, they tend to work more. These findings suggest that household formation rules are strongly related both to women’s demand for sons and to the direction of intergenerational transfers.     

Geographic labour mobility and the cost of housing: evidence from Italy

In recent years, internal migration in Italy has declined markedly, notwithstanding the widening of the North-South gap in terms of unemployment rates and real income. Here, the extent to which the housing market has contributed to the decline is examined. Preliminary to this analysis, differentials in the cost of housing between the macro-areas of the country are estimated using data on the market price of houses located in 96 provincial capitals. Econometric evidence is provided supporting the view that the North-South housing price differential is a notable factor in explaining the falling pattern of mobility. The positive impact on migration from the South to the North of a wider gap in the two areas in terms of income and employment prospects has been offset by the housing price differential, which has steadily risen at least from the mid-1980s onwards. Yet, a considerable share of the decrease in mobility remains unexplained, possibly owing to the heterogeneity in the composition of migration flows across different cohorts.     

The dynamics of food insecurity and overall health: evidence from the Canadian National Population Health Survey

The paper explores whether the responses to household food insecurity questions in cycles two and three of the Canadian National Population Health Survey help explain the links between socioeconomic status and health at the individual level. Short-term transitions in food insecurity status are correlated with changes in health status. There is some evidence for females but not for males that conditional on current health, current household food insecurity can lead to lower future health status, even in the short run. There is stronger evidence for both males and females that conditional on current household food insecurity status, lower current health status can lead to an increased probability of future household food insecurity.     

Monopolistic supply of sorting,inequality, and welfare

Why is an increase in income inequality often accompanied by an increase in socioeconomic segregation? And what are the welfare implications of this comovement? This paper uses a theoretical model to analyze the relationship between income inequality and socioeconomic segregation. It shows that rising inequality can trigger sorting according to income, as a monopolist's profits from offering sorting increase with income inequality. It also examines the relationship between sorting and social welfare and shows that profit-maximizing sorting patterns are not necessarily optimal from a welfare perspective. In fact, for a broad field of income distributions (monopolist) profits increase with inequality, while at the same time total welfare from sorting decreases.     

Testing economic models of volunteer labour supply: some empirical evidence for the German Red Cross

We use a new data set collected by means of a questionnaire study of volunteers of the German Red Cross to test predictions of three competing economic models of volunteer labour supply: the public-goods model, the private-consumption model and the human-capital model. The three competing economic models make different predictions regarding the response of a volunteer’s labour supply to a change in the perceived labour supply of other volunteers. Our empirical results lend support to the public-goods model.     

Illicit drug use and labour market achievement: evidence from the UK

This study, using data from the British Crime Survey (BCS), examines the effect of drug use on occupational achievement. It starts by attempting to overcome the identification problem that results from the limited set of drug use questions presented in the BCS. Taking this into account, and allowing for the endogeneity of drug use in equations for unemployment and labour market outcomes, that a mild positive association with ‘soft’ drugs and occupational achievement is observed that diminishes with age. This relationship holds for males but not for females. In contrast, it is also found that past use of ‘hard’ drugs significantly increases the likelihood of current unemployment, although it appears to be unrelated to occupational success, conditional on achieving employment.     

Regulation, innovation and public welfare: the example of the food industry

The complex relationship between innovation and regulation in the food industry is analyzed with a view to identifying the ways in which regulation both promotes and inhibits particular kinds of innovation, and also the relevance of both innovation and regulation to the protection and improvement of public health. The effects of regulation on innovation are complex, since regulation simultaneously inhibits some kinds of development while encouraging others, but those which are inhibited are typically unsafe or undesirale. There is, however, no evidence that public welfare is being undermined by excessive regulations or by too few innovations in the food sector.     

Regulation,innovation and public welfare: the example of the food industry

The complex relationship between innovation and regulation in the food industry is analyzed with a view to identifying the ways in which regulation both promotes and inhibits particular kinds of innovation, and also the relevance of both innovation and regulation to the protection and improvement of public health. The effects of regulation on innovation are complex, since regulation simultaneously inhibits some kinds of development while encouraging others, but those which are inhibited are typically unsafe or undesirale. There is, however, no evidence that public welfare is being undermined by excessive regulations or by too few innovations in the food sector.