The project aim is the progression of the IAB/ZEW model PACE-L, which has been developed as model instrument for the macroeconomic analysis of labour market policies. The extension now supports the disaggregation of the labour supply side in order to investigate labour market effects of the presently discussed reforms of the tax and transfer system. The disaggregation is intended to both take account of household heterogeneity on the one hand and the heterogeneity of employment structures (i.e. different working-time options) on the other. Thereby the participation choice of the different household types will be particularly addressed. For their exact model treatment it is furthermore necessary to account for a more detailed description of the German tax and transfer system as compared to the current model outset. This is essential even more so as current reform proposals usually contend substantial adjustments to the tax and transfer system and thus of the heterogenous household's budget restrictions. The projected disaggregation of the labour supply side requires a household as well as working-time specific account of tax and transfer characteristics.
01.12.2003 - 31.10.2004