Melbourne Institute of Applied Economic and Social Research - Research Publications

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    Demands for childcare and household labour supply in Australia
    DOIRON, DJ ; KALB, GR (Blackwell Publishing Inc., 2005)
    Demands for formal and informal child care are estimated using a bivariate Tobit model. Predicted costs of child care are incorporated in the households’ budget constraint and a discrete choice labour supply model is estimated. Separate models are estimated for couples and lone parents. Increases in the prices and costs of child care lead to reductions in labour supply for lone parents and partnered mothers. Results suggest the average elasticities in Australia are closer to those found in the UK and are smaller than the estimates for Canada and the US. Effects are stronger for single parents and mothers facing low wages.
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    Health status and labour force participation: evidence from Australia
    Cai, LX ; Kalb, G (JOHN WILEY & SONS LTD, 2006-03-01)
    This paper examines the effect of health on labour force participation using the Household, Income and Labour Dynamics in Australia (HILDA) Survey. The potential endogeneity of health, especially self-assessed health, in the labour force participation equation is addressed by estimating the health equation and the labour force participation equation simultaneously. Taking into account the correlation between the error terms in the two equations, the estimation is conducted separately for males aged 15-49, males aged 50-64, females aged 15-49 and females aged 50-60. The results indicate that better health increases the probability of labour force participation for all four groups. However, the effect is larger for the older groups and for women. As for the feedback effect, it is found that labour force participation has a significant positive impact on older females' health, and a significant negative effect on younger males' health. For younger females and older males, the impact of labour force participation on health is not significant. The null-hypothesis of exogeneity of health to labour force participation is rejected for all groups.
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    Academic performance, childhood economic resources, and the choice to leave school at age 16
    Maani, SA ; Kalb, G (Pergamon Press Ltd., 2007-06-01)
    A general international observation is that adolescents from disadvantaged families are more likely to leave school at age 16. In this paper we extend the literature on school-leaving decisions by using a new and extensive panel data set from New Zealand; and by examining the effect of family income, and personal and environmental characteristics since childhood on both academic performance and subsequent schooling choices. Results obtained from single equations and joint estimation, allowing for possible endogeneity of academic performance, reveal the importance of the role of academic performance in models of demand for education. Several factors that are at work for a long time, such as household income at different points in time, influence the school-leaving decision through academic performance. These results point to the role that stimulating academic performance can play in breaking cycles of disadvantage. © 2006 Elsevier Ltd. All rights reserved.
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    The Effect of Financial Incentives on Labour Supply: Evidence for Lone Parents from Microsimulation and Quasi-Experimental Evaluation
    CAI, L ; KALB, G ; TSENG, Y ; VU, THH (Institute for Fiscal Studies, 2008-06)
    The aim of this paper is to analyse the work incentive effects of a change in the Australian tax and transfer system on lone parents in July 2000. To evaluate the effect of the total change only, microsimulation can be used; but for a subgroup of lone parents, a few components of this policy change can be analysed through two alternative approaches - microsimulation and quasi-experimental evaluation. Both approaches examine the effects on the probability of employment and on average working hours. The results from microsimulation show that the combined changes introduced in July 2000 - involving reduced withdrawal rates, changed family payments and lower income tax rates - have increased labour supply for lone parents to a moderate extent. The estimated effect on average working hours when using microsimulation is very close to the effect estimated in a quasi-experimental approach using matching techniques to control for alternative influences.
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    Effects of the Australian new tax system on government expenditure with and without behavioural changes
    Kalb, G. R. ; Kew, H. ; Scutella, R. ( 2003-04)
    This paper uses the Melbourne Institute Tax and Transfer Simulator to examine the effects of the New Tax System introduced in Australia in July 2000. First the whole set of changes is studied and then some of its components are discussed separately. From the results it is clear that the change in income tax rates and thresholds had the largest effect, because it affected a large proportion of the population whereas the changes to the benefit system are only relevant to smaller groups. Families with children benefited on average most from the changes, firstly through the changes in income taxes and secondly through the changes in Family Payments. However, families with children were also more likely to experience a loss indicating a wider range of positive and negative outcomes for this group.
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    Wage and employment rates in New Zealand from 1991 to 2001
    Kalb, G ; Scutella, R (Taylor & Francis, 2004-01-01)
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    Estimation of labour supply models for four separate groups in the Australian population
    Kalb, G. R. ( 2002-11)
    This paper estimates discrete choice models of labour supply for couples, single men, single women and sole parents in Australia using the Income and Housing Costs Survey of 1994/1995, 1995/1996, 996/1997 and 1997/1998. These models are estimated to serve as input in a microsimulation model, where they generate the behavioural responses to policy changes. The results are according to expectations, with preferences for work being higher for people with higher education, who are in their thirties. Furthermore, for women the presence of young children decreases the preference for work. Expected labour supply, predicted by using the estimated models, results in values close to the observed average.
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    Economic analyses of families: existing research findings
    Johnson, D. ; Kalb, G. R ( 2002-12)
    This paper provides a literature review on economics of the family. In particular, where decisions of families related to marriage, fertility, labour supply and home production are concerned. First an overview of the theory on these issues is given, followed by a selection of empirical studies. Finally, the review highlights some areas of interest for future research in Australia.
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    Estimation of wage equations in Australia: allowing for censored observations of labour supply
    Kalb, G. R. ; Scutella, R. ( 2002-05)
    This paper presents results for five separately estimated sets of participation and wage equations. The Australian working-age population is divided into sole parents, single men, single women, married men and married women. The approach in this paper takes the censoring of labour supply observations at 50 hours per week into account. The results for the wage equations are as anticipated with education, work experience and age increasing the expected wage. As expected, allowing for the censoring of labour supply reduces the predicted wage levels, particularly for married men who are most likely to work 50 hours or more.
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    The relationship between juvenile and adult crime
    Kalb, G. R. ; Williams, J. ( 2002-04)
    Previous studies find a positive relationship between juvenile and adult criminal involvement. Using data on males from the Delinquency in a Birth Cohort II study, we ivestigate whether this correlation is due to unobserved characteristics that increase the probability of both juvenile and adult crime, or whether it is due to true state dependence in crime. Distinguishing between state dependence and heterogeneity is important from a policy perspective. For example, if youthful crime causes adult crime, then policies that reduce a juvenile's criminal behavior will also reduce criminal behavior as an adult. Using a treatment effects model, we find evidence of both state dependence and heterogeneity in the relationship between juvenile and adult crime. The causal influence of delinquency on adult crime is largest for white males and males with fewer years of schooling. The findings suggest that preventive policies that divert juveniles from crime are a viable policy tool for reducing the overall rate of crime.