Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/20754 
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dc.contributor.authorBargain, Olivieren
dc.date.accessioned2009-01-28T16:16:30Z-
dc.date.available2009-01-28T16:16:30Z-
dc.date.issued2005-
dc.identifier.urihttp://hdl.handle.net/10419/20754-
dc.description.abstractDiscrete-choice models provide a simple way of representing utility-maximizing labor supplydecisions in the presence of highly nonlinear and possibly non-convex budget constraints.Thus, it is not surprising that they are so extensively used for ex-ante evaluation of taxbenefitreforms. The question asked in this paper is whether it is possible and desirable to getstill more flexibility by relaxing some of the usual constraints imposed on householdpreferences and rationality. We first suggest a model which attains flexibility by makingparameters vary freely across hours choices. By embedding the traditional structuralapproach in this specification, it is shown that the restrictions on underlying well-behavedleisure-consumption preferences are rejected. More fundamentally still, the standardapproach, i.e., the assumption of unitary households optimizing statically, is strongly rejectedwhen tested against a general model with price- and income-dependent preferences. In astatic environment, the result boils down to a rejection of the unitary model. Interestingly,restrictions from both structural and standard models also imply important discrepancies inestimated elasticities and simulated predictions of responses to a tax reform. In particular,large differences appear between standard models and the general model which possiblyencompasses several interpretations including dynamic aspects and intrahouseholdnegotiation. These findings illustrate the difficulty to conduct policy analysis in a way whichreconciles the best explanatory power and a framework consistent with economic theory. Thegeneral model we suggest may provide future research with an interesting setting to testsome of the dimensions of household behavior.en
dc.language.isoengen
dc.publisher|aInstitute for the Study of Labor (IZA) |cBonnen
dc.relation.ispartofseries|aIZA Discussion Papers |x1455en
dc.subject.jelH31en
dc.subject.jelC52en
dc.subject.jelJ22en
dc.subject.jelC25en
dc.subject.ddc330en
dc.subject.keywordmultinomial logiten
dc.subject.keywordhousehold labor supplyen
dc.subject.keywordtaxationen
dc.subject.keywordmicrosimulationen
dc.subject.keywordunitary modelen
dc.subject.keywordcollective modelen
dc.subject.stwArbeitsangeboten
dc.subject.stwHaushaltsökonomiken
dc.subject.stwDiskrete Entscheidungen
dc.subject.stwFamilienbesteuerungen
dc.subject.stwSchätzungen
dc.subject.stwTheorieen
dc.subject.stwFrankreichen
dc.titleOn Modeling Household Labor Supply with Taxation-
dc.typeWorking Paperen
dc.identifier.ppn478331401en
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen

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