Recent studies have examined tax policy issues using labour supply models characterised by a discretised budget set. Microsimulation modelling using a discrete hours approach is probabilistic. This makes analysis of the distribution of income difficult as even for a small sample with a modest...

The distributional implications of an extreme hypothetical reform of the Australian tax-transfer system are examined using the Melbourne Institute Tax and Transfer Simulator. This simulation model predicts labour supply using a probabilistic discrete hours approach. The analysis of the...

This paper considers the question of whether it is possible to identify labour supply incentive effects of a tax and transfer system using information on only the distribution of earnings. The major characteristics of earnings distributions arising from a simple labour supply model are examined....

This paper examines the implications, for overall social welfare and inequality comparisons, of using different definitions of the unit of analysis - the income recipient - in computing summary measures. Comparisons are made using the Melbourne Institute Tax and Transfer Simulator (MITTS), a...

Microsimulation Modelling of Taxation and the Labour Market reports new research on behavioural microsimulation modelling of tax and transfer systems. Its aims are twofold. Firstly, the book discusses the rationale for the basic modelling approach adopted and provides information on econometric...