Long-Term Changes in Labor Supply and Taxes: Evidence from OECD Countries, 1956-2004
We document large differences in trend changes in hours worked across OECD countries over the period 1956-2004. We then assess the extent to which these changes are consistent with the intratemporal first order condition from the neoclassical growth model. We find large and trending deviations from this condition, and that the model can account for virtually none of the changes in hours worked. We then extend the model to incorporate observed changes in taxes. Our findings suggest that taxes can account for much of the variation in hours worked both over time and across countries.
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Copy CitationLee Ohanian, Andrea Raffo, and Richard Rogerson, "Long-Term Changes in Labor Supply and Taxes: Evidence from OECD Countries, 1956-2004," NBER Working Paper 12786 (2006), https://doi.org/10.3386/w12786.Download Citation
Non-Technical Summaries
- Differences in taxes across countries are a very important piece of the explanation for the vastly different levels of hours of market...
Published Versions
Ohanian, Lee & Raffo, Andrea & Rogerson, Richard, 2008. "Long-term changes in labor supply and taxes: Evidence from OECD countries, 1956-2004," Journal of Monetary Economics, Elsevier, vol. 55(8), pages 1353-1362, November. citation courtesy of 
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