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Nina Smith

Overtime work, dual job holding, and taxation

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  • http://www.asb.dk/omos/institutter/departmentofeconomics/
  • http://www.asb.dk/forskning/forskningscentreoggrupper/forskningscentre/centreforresearchinintegrationeducationqualificationsandmarg/
Labor supply data seldom include detailed information on hours and
wages in secondary job or overtime work. Based on survey information on
hours and wages in overtime work and second job which is merged to
administrative register information on income taxes and deductions we
estimate a ‘‘Hausman labor supply model,’’ which allows for a detailed
treatment of nonconvexities. Including explicit information on overtime
pay and second job wages increase the estimated elasticities compared to
a standard labor supply model without this information. However,
allowing a more flexible treatment of nonconvexities the estimated
elasticities are reduced; even below the estimates of the baseline results. In
simulations we show that these findings have significant consequences
when evaluating the degree of self-financing of various tax reforms.
Original languageEnglish
Book seriesResearch in Labor Economics
Pages (from-to)25-55
Publication statusPublished - 2008

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