Micro and macro elasticities in a life cycle model with taxes

• 成果类型: Article
• 署名作者: Rogerson, Richard; Wallenius, Johanna
• 署名单位: Arizona State University; Arizona State University-Tempe
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2008.05.011
• 发表日期: 2009
• 页码: 2277-2292
• 关键词: labor supply; life cycle; taxes

摘要

We build a life cycle model of labor supply that incorporates changes along both the intensive and extensive margin and use it to assess the consequences of changes in tax and transfer policies on equilibrium hours of work. We find that changes in taxes have large aggregate effects on hours of work. Moreover, we find that there is no inconsistency between this result and the empirical finding of small labor elasticities for prime age workers. In our model, micro and macro elasticities are effectively unrelated. Our model is also consistent with other cross-country patterns. (C) 2008 Elsevier Inc. All rights reserved.