PT  - JOURNAL ARTICLE
AU  - Flood, Lennart
AU  - Hansen, Jörgen
AU  - Wahlberg, Roger
TI  - Household Labor Supply and Welfare Participation in Sweden
AID  - 10.3368/jhr.XXXIX.4.1008
DP  - 2004 Oct 02
TA  - Journal of Human Resources
PG  - 1008--1032
VI  - XXXIX
IP  - 4
4099  - http://jhr.uwpress.org/content/XXXIX/4/1008.short
4100  - http://jhr.uwpress.org/content/XXXIX/4/1008.full
SO  - J Hum Resour2004 Oct 02; XXXIX
AB  - We formulate and estimate a structural, static model of household labor supply and multiple welfare program participation. Given the complicated nature of both the income tax schedule and the benefit rules for different welfare programs, we use a detailed micro simulation model to generate accurate budget sets for each work-welfare combination. We also use high-quality data on earnings and other types of incomes obtained both from employers and from income tax records. The results suggest that labor supply among two-parent families in Sweden is quite inelastic. A policy simulation designed to increase labor supply incentives for low income families generated substantial positive welfare effects, despite only minor changes in labor supply and in welfare participation.