Objective
The aggregate response of labour supply to business cycle shocks is a central element in macroeconomic analysis and is the object of an important debate among economists. This debate matters as our understanding of the business cycle data and of the consequence of tax policies rely critically on the elasticity of aggregate labour supply. Because the standard macroeconomic analysis is based on a theory of a single (representative) individual, this analysis cannot distinguish between individual and aggregate labour supply. In an insightful paper, Chang and Kim (2006) construct a heterogeneous agent economy and find that the macro labour supply elasticity can be significantly larger than the micro elasticity. This proposal aims to develop a theory of labour supply decisions of heterogeneous individuals that is consistent with micro level data. The theory will be used to study issues in macroeconomic analyses that depend critically on the elasticity of labour supply: a) Can differences in income taxation account for the large differences in labour supply between North America and Europe? b) How does income taxation affect labour supply decisions across the heterogeneous individuals? c) Existing business cycle theory cannot account for the relative volatility of employment and hours per worker. Can heterogeneity in the labour force resolve this puzzle? d) How responsive are retirement decisions to changes in the social security system and in the tax code? How should the social security system be reformed to confront the demographic imbalances threatening its sustainability? This ambitious proposal will help the researcher to reintegrate among the European academics and will provide a clear input to the European research area. Luisa Fuster is eager to be one of the leading researchers of the IMDEA Social Sciences and to become a reference among European academics.
Fields of science (EuroSciVoc)
CORDIS classifies projects with EuroSciVoc, a multilingual taxonomy of fields of science, through a semi-automatic process based on NLP techniques. See: https://op.europa.eu/en/web/eu-vocabularies/euroscivoc.
CORDIS classifies projects with EuroSciVoc, a multilingual taxonomy of fields of science, through a semi-automatic process based on NLP techniques. See: https://op.europa.eu/en/web/eu-vocabularies/euroscivoc.
- social sciences sociology governance taxation
- social sciences economics and business business and management employment
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Keywords
Project’s keywords as indicated by the project coordinator. Not to be confused with the EuroSciVoc taxonomy (Fields of science)
Project’s keywords as indicated by the project coordinator. Not to be confused with the EuroSciVoc taxonomy (Fields of science)
Programme(s)
Multi-annual funding programmes that define the EU’s priorities for research and innovation.
Multi-annual funding programmes that define the EU’s priorities for research and innovation.
Topic(s)
Calls for proposals are divided into topics. A topic defines a specific subject or area for which applicants can submit proposals. The description of a topic comprises its specific scope and the expected impact of the funded project.
Calls for proposals are divided into topics. A topic defines a specific subject or area for which applicants can submit proposals. The description of a topic comprises its specific scope and the expected impact of the funded project.
Call for proposal
Procedure for inviting applicants to submit project proposals, with the aim of receiving EU funding.
Procedure for inviting applicants to submit project proposals, with the aim of receiving EU funding.
FP7-PEOPLE-IRG-2008
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Funding Scheme
Funding scheme (or “Type of Action”) inside a programme with common features. It specifies: the scope of what is funded; the reimbursement rate; specific evaluation criteria to qualify for funding; and the use of simplified forms of costs like lump sums.
Funding scheme (or “Type of Action”) inside a programme with common features. It specifies: the scope of what is funded; the reimbursement rate; specific evaluation criteria to qualify for funding; and the use of simplified forms of costs like lump sums.
Coordinator
28760 TRES CANTOS
Spain
The total costs incurred by this organisation to participate in the project, including direct and indirect costs. This amount is a subset of the overall project budget.