Over 75% of Federal tax revenue is raised through the income tax and FICA taxes. The potential effects on labor supply and economic welfare are important because of the large and increasing reliance on direct taxation. Over the past few years significant legislative changes have occurred with...

This chapter discusses taxes and labor supply. The effect of taxes on labor supply introduces interesting questions in economic theory, econometrics, and public finance. Since the greatest share of federal tax revenue, approximately 50 in 1980, is raised by the individual income tax. The federal...

Over 75% of Federal tax revenue is raised through the income tax and FICA taxes. The potential effects on labor supply and economic welfare are important because of the large and increasing reliance on direct taxation. Over the past few years significant legislative changes have occurred with...