Research Article
What Are the Economic and Labour Market Effects of an Income Tax Reduction Targeted at Older Workers?
Table 2
Behavioural and public policy parameters.
| Parameter | Notation | Value |
| Consumer preferences | | | Intertemporal elasticity of substitution | | 0.90 | Intratemporal elasticity of substitution | | 0.80 | Production technology | | | Production share of physical capital | | 0.30 | Elasticity of substitution for labour demand | | 1.50 | Depreciation rate of physical capital | | 0.05 (per year) | Interest rate | | 0.04 (per year) | Human capital technology | | | Elasticity of time input | | 0.70 | Elasticity of public spending input | | 0.18 | Public policy | | | CPP/QPP replacement rate | | 0.20 | RPP replacement rate | | 0.02–0.14 | Government expenditures/GDP | | 0.37 | Earned income tax rate | | 0.31 | Capital income tax rate | | 0.38 | Consumption tax rate | | 0.10 |
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