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Filling in the blanks: How does information about the Swedish EITC affect labour supply?

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  • Nyman, Pär
  • Aggeborn, Linuz
  • Ahlskog, Rafael

Abstract

We investigate the role of information about tax incentives for the labour–leisure choice. We randomize 37,000 leaflets about the Swedish EITC, and then study the effects with pre-registered analyses and administrative data. Our focus is on the household decision to allocate between labour income and parental leave payments. The EITC and its interactions with the parental leave system is not well-known. Despite the substantial incentives involved, and the flexibility with which a person may earn labour income, we find that information about the EITC has a precisely estimated zero impact on labour supply on the extensive and the intensive margin.

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  • Nyman, Pär & Aggeborn, Linuz & Ahlskog, Rafael, 2023. "Filling in the blanks: How does information about the Swedish EITC affect labour supply?," Labour Economics, Elsevier, vol. 85(C).
    • Handle: RePEc:eee:labeco:v:85:y:2023:i:c:s0927537123001100
    DOI: 10.1016/j.labeco.2023.102435
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    More about this item

    Keywords

    Labour supply; Information; Experiment; Earned Income Tax Credit; Sweden;
    All these keywords.

    JEL classification:

    • J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education

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