TY - GEN
T1 - The impact of tax reform in 2004 on the female labour supply in Japan
AU - Sakata, Kei
AU - McKenzie, C. R.
PY - 2005
Y1 - 2005
N2 - In 2003, the Japanese Diet passed legislation to abolish part of the special deduction for spouses (Haigusha Tokubetsu Kojo) which would take effect in the 2004 tax year. This paper investigates the impact of this tax reform on female labour supply in Japan. A number of earlier studies have shown that married women are likely to adjust their labour supply in order for their husbands to become eligible to take advantage of this deduction. By using the first and second waves of the Keio Household Panel Survey (KHPS) collected in 2004 and 2005, this paper uses the difference-in-differences approach to examine whether there has been any change in the behaviour of female labour supply as a result of this tax reform. The empirical evidence indicates that the tax reform in 2004 had a negative and statistically significant impact on both the decision of female spouses to enter the labour market and on the number of hours they worked conditional on their participation in the labour market. In addition, the empirical evidence obtained does not support the Douglas-Arisawa Law.
AB - In 2003, the Japanese Diet passed legislation to abolish part of the special deduction for spouses (Haigusha Tokubetsu Kojo) which would take effect in the 2004 tax year. This paper investigates the impact of this tax reform on female labour supply in Japan. A number of earlier studies have shown that married women are likely to adjust their labour supply in order for their husbands to become eligible to take advantage of this deduction. By using the first and second waves of the Keio Household Panel Survey (KHPS) collected in 2004 and 2005, this paper uses the difference-in-differences approach to examine whether there has been any change in the behaviour of female labour supply as a result of this tax reform. The empirical evidence indicates that the tax reform in 2004 had a negative and statistically significant impact on both the decision of female spouses to enter the labour market and on the number of hours they worked conditional on their participation in the labour market. In addition, the empirical evidence obtained does not support the Douglas-Arisawa Law.
KW - Difference-in differences
KW - Female labour supply
KW - Policy reform
KW - Program evaluation
KW - Tax reform
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M3 - Conference contribution
AN - SCOPUS:45749116341
SN - 0975840002
SN - 9780975840009
T3 - MODSIM05 - International Congress on Modelling and Simulation: Advances and Applications for Management and Decision Making, Proceedings
SP - 1084
EP - 1090
BT - MODSIM05 - International Congress on Modelling and Simulation
T2 - International Congress on Modelling and Simulation: Advances and Applications for Management and Decision Making, MODSIM05
Y2 - 12 December 2005 through 15 December 2005
ER -