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Download or read book Behavioural Response in the Context of Socio-economic Microanalytic Simulation written by Lars Osberg and published by Statistics Canada. This book was released on 1986 with total page 108 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper presents a critical survey of the labour/leisure choice frame-work and its usefulness in analyzing behavioural response to tax and social policy legislation. Micro simulation, once it moves beyond simplistic incidence analysis, must consider the behavioural response of individuals to changes which legislation induces in the constraints which individuals face. Due to its analytical simplicity, the labour/leisure framework offers a useful "first step" in modeling such behavioural response. The paper surveys the existing literature on labour supply elasticities and suggests some working assumptions. It concludes, however, on a note of caution - namely that the single period labour/leisure choice model may be a very poor guide to the behaviour of the "working poor" when confronted with changes tax and social policy legislation -- more elaborate models of lifecycle behaviour are clearly required.