Separate taxation and married women's labor supply: a comparison of West Germany and Sweden.

"The focus of this paper is an empirical analysis of the effects of taxation on women's incentives to contribute to family income. Data on earnings and individual characteristics in 1984 for married or cohabiting Swedish couples...are used together with similar data on German couples.... The main features of the personal income taxation of the two countries have been programmed, and are used for simulating after tax incomes using both tax systems for both countries.... The difference between the Swedish and German tax systems is an important factor in explaining why Swedish women participate more than German women in the labor market, although paid parental leaves and subsidized childcare are other important explanations for the Swedish situation." excerpt