tailieunhanh - The working families’ tax credit and some European tax reforms in a collective setting

This paper addresses some of the microeconomic implications of this policy regime change, focusing on the flows of bank credit to the enterprise sector and analysing independently the determinants of corporate credit from the side of lenders and borrowers. To this effect we use results from the recent literature to formulate and specify equations reflecting the motivation behind lending and borrowing decisions. These equations are estimated econometrically using firm level data for Bulgarian firms for the period 1995-1999. In analyzing the results we seek to identify changes in behavioral patterns which can be associated with the change in the policy. | The working families tax credit and some European tax reforms in a collective setting Michal Myck Olivier Bargain Miriam Beblo Denis Beninger Richard Blundell Raquel Carrasco Maria-Concetta Chiuri Francois Laisney Valerie Lechene Ernesto Longobardi Nicolas Moreau Javier Ruiz-Castillo Frederic Vermeulen Abstract A framework for simplified implementation of the collective model of labor supply decisions is presented in the context of fiscal reforms in the UK. Through its collective form the model accounts for the well known problem of distribution between wallet and purse a broadly debated issue which has so far been impossible to model due to the limitations of the unitary model of household behavior. A calibrated data set is used to model the effects of introducing two forms of the Working Families Tax Credit. We also summarize results of estimations and calibrations obtained using the same methodology on data from five other European countries. The results underline the importance of taking account of the intrahousehold decision process and suggest that who receives government transfers does matter from the point of view of labor supply and welfare of household members. They also highlight the need for more research into models of household behavior. Keywords Collective models Fiscal reforms Household labor supply Intrahousehold allocation M. Myck R. Blundell V. Lechene IFS London UK e mail MMyck@ M. Myck DIW Berlin Germany O. Bargain IZA Bonn Germany M. C. Chiuri O. Bargain CHILD Turin Italy M. Beblo D. Beninger F. Laisney ZEW Mannheim Germany R. Blundell UCL London UK R. Carrasco J. Ruiz Castillo Universidad Carlos III Madrid Spain E. Longobardi M. C. Chiuri Universita di Bari Bari Italy F. Laisney BETA Theme ULP Strasbourg France V. Lechene Wadham College Oxford England N. Moreau GREMAQ and LIRHE Toulouse France F. Vermeulen Tilburg University Tilburg The Netherlands 1 1. Introduction One of the major reforms of the UK Labour Government in the area of .