Why Are Mothers Working Longer Hours in Austria than in Germany? A Comparative Microsimulation Analysis

Dearing, Helene and Hofer, Helmut and Lietz, Christine and Winter-Ebmer, Rudolf and Wrohlich, Katharina (2007) Why Are Mothers Working Longer Hours in Austria than in Germany? A Comparative Microsimulation Analysis. Fiscal Studies, 28 (4), pp. 463-495.

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Abstract or Table of Contents

Labour force participation rates of mothers in Austria and Germany are similar; however, full-time employment rates are much higher among Austrian mothers. In order to find out to what extent these differences can be attributed to differences in the tax-transfer system, we perform a comparative microsimulation exercise. After estimating structural labour supply models for both countries, we interchange two important institutional characteristics of the two countries - namely, (i) the definition of the tax unit within the personal income tax and (ii) the parental leave benefit scheme. As our analysis shows, differences in mothers’employment patterns can partly be explained by the different tax systems: while Germany has a system of joint taxation with income splitting for married couples, Austria taxes everyone individually, which leads to lower marginal tax rates for secondary earners than in the German system. (authors' abstract)

Item Type: Article in Academic Journal
Classification Codes (e.g. JEL): J22, H31, H24
Status: Published
Date Deposited: 22 May 2015 07:51
Last Modified: 01 Apr 2016 14:19
URI: http://irihs.ihs.ac.at/id/eprint/3400

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