The Female Immigrant Labour Supply: The Effect of an In-work Benefit

Abstract

We explore the effect of an in-work benefit on the labour supply of single immigrant women in Sweden. Using a simulation approach, we find that, on average, the in-work benefit has no effect on the labour supply of these women. However, women with low incomes increase their labour supply, a response that is the strongest among non-European and Eastern and Southern European women, and is mainly a result of increased participation in the labour market. High-income earners slightly reduce their working hours. Thus, the results suggest that the in-work benefit may strengthen the labour market attachment of low-income immigrant women.