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Taxes and Market Hours: The Role of Gender and Skill

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  • Duval Hernández, Robert

    (Open University of Cyprus)

  • Fang, Lei

    (Federal Reserve Bank of Atlanta)

  • Ngai, L. Rachel

    (London School of Economics)

Abstract

Cross-country differences of market hours in 17 OECD countries are mainly due to the hours of women, especially low-skilled women. This paper develops a model to account for the gender-skill differences in market hours across countries. The model explains a substantial fraction of the differences in hours by taxes, which reduce market hours in favor of leisure and home production, and by subsidized care, which frees (mostly) women from home care in favor of their market hours. Low-skilled women are more responsive to policy because of their low market returns and their comparative advantage in home activities.

Suggested Citation

  • Duval Hernández, Robert & Fang, Lei & Ngai, L. Rachel, 2017. "Taxes and Market Hours: The Role of Gender and Skill," IZA Discussion Papers 11002, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp11002
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    References listed on IDEAS

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    Cited by:

    1. Chakraborty, Lekha, 2021. "Fiscal Federalism, Expenditure Assignments and Gender Equality," Working Papers 21/334, National Institute of Public Finance and Policy.
    2. Chakraborty, Lekha S, 2021. "Fiscal Federalism, Expenditure Assignments and Gender Equality," MPRA Paper 111949, University Library of Munich, Germany.
    3. Cristian Alonso & Mariya Brussevich & Ms. Era Dabla-Norris & Yuko Kinoshita & Ms. Kalpana Kochhar, 2019. "Reducing and Redistributing Unpaid Work: Stronger Policies to Support Gender Equality," IMF Working Papers 2019/225, International Monetary Fund.

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    More about this item

    Keywords

    cross-country differences in market hours; home production; subsidies on family care;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy; Modern Monetary Theory
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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