Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/250126 
Year of Publication: 
2021
Series/Report no.: 
Discussion Papers No. 959
Publisher: 
Statistics Norway, Research Department, Oslo
Abstract: 
Information about individual choices of heterogeneous agents. Results can for example be used to describe the distributional effects of tax policy change, such as the effects on changes in money metric utility - distributions of equivalent and compensating variation (EV or CV). This type of "revealed preference" methodology relies on using models with sufficient realism. In this paper we argue that the so-called "job choice model" represents a way forward in practical work, as it has a richer representation of choice constraints than conventional labour supply models. This model is also particularly suitable given an increased focus on distinguishing between preferences and constraints in applied welfare analysis. We demonstrate the empirical content of the framework by describing the effects of the Norwegian tax reform 2013-2019 on the distribution of compensating variation (CV).
Subjects: 
labour supply
money metric utility
distributional effects
tax reform
JEL: 
H31
I31
J22
C25
Document Type: 
Working Paper

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