EconPapers    
Economics at your fingertips  
 

Targeting fertility and female participation through the income tax

Ghazala Azmat () and Libertad Gonzalez ()

Labour Economics, 2010, vol. 17, issue 3, 487-502

Abstract: We evaluate the effect of a 2003 reform in the Spanish income tax on fertility and the employment of mothers with small children. The reform introduced a tax credit for working mothers with children under the age of three, while also increasing child deductions for all households with children. Theoretically, given the interplay of these two components, the expected effect of the reform is ambiguous on both outcomes. We find that the combined reforms significantly increased both fertility (by almost 5%) and the employment rate of mothers with children under three (by 2%). These effects were more pronounced among less-educated women. In addition, to disentangle the impact of the two reform components, we use an earlier reform that increased child deductions in 1999. We find that the child deductions affect mothers' employment negatively, which implies that the 2003 tax credit would have increased employment even more (up to 5%) in the absence of the change in child deductions.

Keywords: Female; labor; force; participation; Fertility; Family; policy; Tax; credit; Child; subsidy (search for similar items in EconPapers)
Date: 2010
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (20) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0927-5371(09)00105-5
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Targeting Fertility and Female Participation Through the Income Tax (2009) Downloads
Working Paper: Targeting fertility and female participation through the income tax (2009) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:labeco:v:17:y:2010:i:3:p:487-502

Access Statistics for this article

Labour Economics is currently edited by A. Ichino

More articles in Labour Economics from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

 
Page updated 2019-09-19
Handle: RePEc:eee:labeco:v:17:y:2010:i:3:p:487-502