21.   One of the most heavily researched areas in economics is the response of labour supply to income taxation.

22.   However, in the non-proportional tax rate case, the virtual income is also altered, generating a further income effect which will serve to alter labour supply.

23.   Under a system of progressive income taxation, there are few a priori sustainable generalizations about the labour supply consequences of taxation.

24.   Empirical work on labour supply can be briefly explored here.

25.   Typically, the value of the uncompensated wage elasticity for males is small and negative, i.e. a mildly backward-bending aggregate labour supply curve.

26.   The equivalent value for women suggests a positively sloped aggregate labour supply curve.

27.   There seems to be a feeling that labour supply ought to be very sensitive to taxation so that the disincentive effects of income taxation are large.

28.   Having said this, there are reasons to suppose that labour supply would not be as responsive to tax changes as is, perhaps, expected.

29.   But the more inelastic was the initial labour supply curve the less impact this disregard of social security benefits will have on employment and wages.

30.   In contrast, turbulent confusion has always surrounded his theory of labour supply.