Using an improved version of the neoclassical labour-supply model, Robert Breunig, Deborah A. Cobb-Clark and Xiaodong Gong analyse the expected impact of the 2005-06 Australian tax reform. They calculate working hours to increase by 1.7 per cent for both men and women and household after-tax incomes to increase by approximately $60 per week on average...

This paper examines the case for maintaining welfare and income redistribution programs even when their adverse general equilibrium effects reduce total earnings of poor households. Using a Cournot model of intra-household decision-making, the authors show that even if welfare cutbacks generate large increases in household income, these may still reduce the well-being of children and...