THE HECKSCHER-OHLIN THEOREM WITH ENDOGENOUS LABOUR SUPPLY*

This note demonstrates that the Heckscher-Ohlin Theorem, stated in terms of factor endowment ratios, is valid independent of the slope of the labour supply curve.     

COMPUTATION OF NASH-BARGAINED MODELS OF HOUSEHOLD LABOUR SUPPLY*

This paper explores a method of recovering the structural parameters of a Nash-bargained model of household labour supply. It proceeds by computing the desired hours of labour supply numerically rather than analytically, thus circumventing the need for analytical tractability. This numerical procedure is then embedded in a conventional maximum-likelihood estimation to obtain estimates of the structural preference parameters. An example using Family Expenditure Survey data is reported.     

间接税对供需失衡的影响分析

从20世纪90年代后期开始到现在,我国同时出现了两个重要的经济现象,一是间接税高速增长,二是宏观经济供需失衡。本文通过建立一般均衡模型和实证分析,研究了这两种经济现象的内在联系,本文的结论是,征收生产型增值税同时抑制投资和消费,整体上对供需失衡的影响不显著;营业税由于税收容易转嫁、存在双重征税的原因,其增长严重强化了供需失衡局面;以消费为税基的税种全部是间接税,消费平均税率的提高强化了供需失衡局面。     

ON THE CONSUMPTION TAX AND THE TAX TREATMENT OF BEQUESTS IN DIFFERENT MODELS OF BEQUEATHING BEHAVIOUR*

The tax treatment of bequests under the consumption tax policy is studied in two models of bequeathing behaviour, a model where the parent cares about the bequest itself and a model where the parent cares about the welfare of his offspring instead. It is shown that the two models make precisely opposite predictions of the effects of the consumption tax including the conditions under which the tax is neutral, the differential incidence of the tax in a closed economy when it is non-neutral, and the international transmission effect of the tax when it is non-neutral.     

TAXATION AND CENTRALISED WAGE SETTING: THE CASE OF ENDOGENOUS LABOUR SUPPLY

The implications of centralised wage setting for the relationship between taxation, wages and employment are studied allowing for endogenous adjustment in work hours. We show that centralisation promotes wage moderation, makes wages and employment less sensitive to changes in wage taxation and reduces the hours worked. With an individual supply of working hours, a wage tax can even improve employment if wage setting is centralised and marginal utility from a public good is sufficiently high. Moreover, if a profit tax is used to finance public expenditure, higher tax reduces wages and improves employment.     

CHILDCARE USE AND PARENTS’ LABOUR SUPPLY IN AUSTRALIA*

Based on data which are representative of the Australian population in 2002, this paper first analyses the demand for and cost of formal and informal childcare for couple and sole‐parent families, shedding light on factors which affect the demand for childcare. The predicted demand of formal childcare and the predicted costs of informal childcare arising from these models are then used to impute total childcare costs at different levels of labour supply. Finally, the predicted total costs are incorporated in the estimation procedure of structural labour supply models for couple and sole parent families. By making several extensions to the methodology adopted in Doiron and Kalb (2005a ), who estimated similar models based on 1996 Australian data and which this paper largely replicates in terms of methodology, it is found that the average elasticities of labour supply with regard to the cost of childcare are quite similar to the earlier estimates. The elasticities remain at the lower end of the range found in the international literature with the exception of the elasticities for sole parents with preschool children and/or on relatively low wages.     

THE EFFECTS OF THE 1978 PREGNANCY DISCRIMINATION ACT ON FEMALE LABOR SUPPLY*

This article analyzes the effects of the 1978 Pregnancy Discrimination Act (PDA) on the labor force participation rates of married women by estimating a dynamic model of labor force participation. Results show that the PDA increased the labor force participation rate of pregnant women by 8.2 percentage points, of women with a child less than one year old by 3.4 percentage points, and of women with older children by 1.5 percentage points. Counterfactual policy simulations show that the provision of unpaid leave will increase the labor force participation rate of women with older children by an additional 3.7 percentage points.     

ENDOGENOUS FERTILITY AND THE CONSUMPTION TAX*

The differential incidence between the consumption tax and the labour income tax is examined in a model where altruistic parents decide the number of children endogenously. In contrast with past results, the consumption tax is not neutral and exerts distortional effects. As a result, welfare gets worse off through the tax reform of switching from a labour income tax to a consumption tax. This provides the argument about the treatment of bequests under a consumption tax.     

THE EFFECTS OF TAXES ON LABOUR IN A DYNAMIC EFFICIENCY WAGE MODEL*

This paper studies the impact of wage and employment taxes in an intertemporal efficiency wage model. Cases with fixed, linear and quadratic adjustment costs associated with job creation are considered. In general, the model shows that an increase in the employment tax leads to an increase in unemployment, reducing job creation, and has ambiguous effect on wages; whereas an increase in the wage tax reduces wages and has ambiguous impact on unemployment and job creation.     

EFFECTS OF A CHILD'S DISABILITY ON AFFECTED FEMALE'S LABOUR SUPPLY IN AUSTRALIA

Australia has experienced a growing rate of child disability, with the rate of 3.7 per cent in 1998 increasing to 4.3 per cent in 2003 for children aged under four years and from 9.5 per cent to 10 per cent for children aged five to 14 years in the same period. However, surprisingly no study has examined the economic effects of child disability in the Australian context. This paper attempts to quantify the link between a child's disability and the work behaviour of the female in the affected family. Our findings provide empirical justifications for the current policy linking the severity level of child disability to the assessment of eligibility for Carer Payment (Child). We also found that child disability has different impacts on the labour market activities of married women and non‐married women. It appears that child disability imposes a greater hardship on non‐married women than on married women in terms of work choice decision. Once non‐married women manage to enter the labour force, they may have to stay on to work as usual even if they have a disabled child, because they may not have other family members to turn to for help as married women do.