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Estimating labour supply elasticities based on cross-country micro data: A bridge between micro and macro estimates?

Markus Jantti, Jukka Pirttilä () and Håkan Selin ()
Additional contact information
Håkan Selin: Uppsala Center for Fiscal Studies, Postal: Department of Economics, Uppsala University, P.O. Box 513, SE-751 20 Uppsala, Sweden

No 2013:1, Working Paper Series, Center for Fiscal Studies from Uppsala University, Department of Economics

Abstract: We utilise repeated cross sections of micro data from several countries, available from the Luxembourg Income Study, LIS, to estimate labour supply elasticities, both at the intensive and extensive margin. The benefit of the data is that it spans over four decades and includes a large number of tax reform episodes, with tax rate variation arising both from cross-sectional and country-level differences. Using these data, we investigate whether micro and macro estimates differ in a systematic way. The results do not provide clear support to the view that elasticities at the macro level would be higher than corresponding micro elasticities.

Keywords: Labour supply; earnings; taxation; cross-country comparisons (search for similar items in EconPapers)
JEL-codes: E24 H21 J22 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-lab, nep-lma and nep-mac
Date: 2013-01-16
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Related works:
Journal Article: Estimating labour supply elasticities based on cross-country micro data: A bridge between micro and macro estimates? (2015) Downloads
Working Paper: Estimating Labour Supply Elasticities Based on Cross-Country Micro Data: A Bridge Between Micro and Macro Estimates? (2014) Downloads
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