TAXATION AND FEMALE PARTICIPATION IN THE LABOR-MARKET

A well established result in empirical economics is that male labour market participation does not respond much to changes in taxation but female participation does. This paper reviews a range of contributions relating to such decisions in the light of two further empirical studies on labour market decisions - one in low income households and the other in higher income households. One finding is that an important factor in decisions relating to female participation appears to be the continuing strength of the traditional division of labour by gender in households. The tax treatment of childcare also emerges as an issue both on first principles and as an influence on the labour market decisions of women (and particularly for women on low incomes).