How information about economic incentives affects parental leave and labour supply
The Swedish EITC (Jobbskatteavdraget) strengthens the incentives for parents to share parental leave equally. However, few people know how the tax reduction works. Does this lack of knowledge mean that the behavioural response to the EITC has not been as strong as it would have been had more people been aware of the incentives?
In this experiment, the authors send a random selection of new parents a letter with information about the EITC, and then analyse how this affected the parents’ labour supply and parental leave.