کد مقاله | کد نشریه | سال انتشار | مقاله انگلیسی | نسخه تمام متن |
---|---|---|---|---|
969147 | 1479458 | 2013 | 19 صفحه PDF | دانلود رایگان |
We estimate the responses of gross labor income with respect to marginal and average net-of-tax rates in France over the period 2003–2006. We exploit a series of reforms to the income-tax and payroll-tax schedules affecting individuals who earn less than twice the minimum wage. Our estimate for the elasticity of gross labor income with respect to the marginal net-of-income-tax rate is around 0.2, while we find no response to the marginal net-of-payroll-tax rate. The elasticity with respect to the average net-of-tax rate is not significant for the income-tax schedule, while it is close to − 1 for the payroll-tax schedule. A plausible explanation is the existence of significant labor supply responses to the income-tax schedule, combined with sticky posted wages (i.e., the gross labor income minus payroll taxes divided by hours worked). Finally, the effect of the net-of-income-tax rate seems to be driven by participation decisions, in particular those of married women.
► We estimate labor income responses to both payroll-tax and income-tax reforms.
► We find a significant response to the marginal income tax rate around 0.2.
► We do not find a significant response to the marginal payroll tax rate.
► This discrepancy is theoretically consistent with a rigidity of the posted wage rate.
Journal: Journal of Public Economics - Volume 99, March 2013, Pages 66–84