Long-term changes in labor supply and taxes: Evidence from OECD countries, 1956-2004

Lee Ohanian, Andrea Raffo, Richard Rogerson

Research output: Contribution to journalArticlepeer-review

119 Scopus citations

Abstract

We document large differences in trend changes in hours worked across OECD countries between 1956 and 2004. We assess the extent to which these changes are consistent with the intratemporal first order condition from the neoclassical growth model, augmented with taxes on labor income and consumption expenditures. We find that the model can account for most of the trend changes in hours worked measured in the data. Differences in taxes explain much of the variation in hours worked both over time and across countries.

Original languageEnglish (US)
Pages (from-to)1353-1362
Number of pages10
JournalJournal of Monetary Economics
Volume55
Issue number8
DOIs
StatePublished - Nov 2008
Externally publishedYes

All Science Journal Classification (ASJC) codes

  • Finance
  • Economics and Econometrics

Keywords

  • Labor supply
  • Taxes
  • Wedges

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