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Joint Taxation and the Labour Supply of Married Women: Evidence from the Canadian Tax Reform of 1988

Thomas Crossley () and Sung-Hee Jeon

Social and Economic Dimensions of an Aging Population Research Papers from McMaster University

Abstract: The Canadian federal tax reform of 1988 replaced a spousal tax exemption with a non-refundable tax credit. This reduced the "jointness" of the tax system: after the reform, secondary earners' effective "first dollar" marginal tax rates no longer depended on the marginal tax rates of their spouses. In practice, the effective "first dollar" marginal tax rates faced by women with high income husbands were particularly reduced. Using difference-in-difference estimators, we find a significant increase in labour force participation among women married to higher income husbands.

Keywords: Labour supply; Canadian tax reform; Married women; Difference-in-difference (search for similar items in EconPapers)
JEL-codes: H24 J22 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2006-02
New Economics Papers: this item is included in nep-pbe and nep-pub
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Joint Taxation and the Labour Supply of Married Women: Evidence from the Canadian Tax Reform of 1988* (2007)
Working Paper: Joint Taxation and the Labour Supply of Married Women: Evidence from the Canadian Tax Reform of 1988 (2006) Downloads
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