This paper uses an event study approach to estimate the impact of children on the gender earnings gap in Australia. We use the Household, Income and Labour Dynamics in Australia (HILDA) survey to show the arrival of children has a large and persistent impact on the gender earnings gap, reducing female earnings by 55 per cent, on average, in the 5 years following parenthood. We further show, using personal income tax data collected by the Australian Tax Office (ATO), that this gap improves only slightly but remains high in the 10 years following the arrival of children. We attribute the gap in earnings to lower participation rates and reduced working hours amongst mothers. Although the decline in earnings for women is very similar regardless of their breadwinner status in the household pre-children, women with greater access to workplace flexibility are more likely to remain employed after having children.

Australian taxpayers display a clear preference for round numbers for end-of-year tax refunds, bunching at positive and salient thresholds such as the tens, hundreds and thousands. Bunching appears to be driven by tax evasion. Data from audited returns shows that bunching is present in returns before audit, but does not persist post-audit. Tax preparers play an important role, being twice as likely to deliver positive round-number refunds as individuals who file their own tax returns. Preparers with greater propensity to bunch deliver larger refunds by lifting deductions and lowering reported income for return items where audits are costly. This highlights how bunching behaviors can help identify tax evasion, including tax preparers who facilitate it and the tax return items which are manipulated.

We produce the first estimates of intergenerational mobility in Australia using administrative data, covering a million individuals born between 1978 and 1982. Australia emerges as one of the more mobile advanced economies, with a rank-rank slope of 0.215 and an intergenerational elasticity of 0.185. This picture of mobility remains under a range of exercises designed to test traditional methodological concerns. While mobility is rapid through most of Australia, there is meaningful dispersion: the mining boom in particular appears to have lifted incomes for those raised in affected regions over the period in question. We extend a generalised error-in-variables model to provide a framework for thinking about the stability of these regional mobility measures. In line with this model, regional rank-rank slopes steadily increase over the period we observe, while the expected (national) income ranks of children fluctuate in ways that partly mirror the changing economic fortunes of Australian regions.

I explore differences in intergenerational income mobility among second generation Australians — why do some communities do better or worse than would be expected from first generation incomes alone? I present a new decomposition of this exceptional income mobility, finding exceptional educational mobility drives many of these differences. Drawing on rich survey and test score data, I provide evidence that educational mobility partly reflects a role for culture — but also the wider context of migration. In particular, migrants facing higher first generation income penalties tend to aspire to and acquire more education, and see it as more important to success.

I use variation in the age at which children move to show that where an Australian child grows up has a causal effect on their adult income, education, marriage and fertility. In doing so, I replicate Chetty and Hendren (2018a) in a country with less inequality, more social mobility and different institutions. Across all outcomes, place typically matters most in the teenage years. Finally, I provide suggestive evidence of peer effects using cross-cohort variation in the peers of permanent postcode residents: those born into a richer cohort for their postcode tend to end up with higher incomes themselves.

We use the 1 July 2004 introduction of the Australian Baby Bonus to identify the effect of family income on child test scores at grade three. Using a difference-in-differences design, we find no evidence that the Baby Bonus improved child outcomes in aggregate, but some evidence of a modest effect for children from disadvantaged backgrounds. We examine whether birth shifting associated with the Baby Bonus and two other Australian maternity payments had negative long-term effects on children. Despite widespread concerns about this unintended treatment, regression discontinuity estimates provide no clear evidence of lasting health or educational consequences.

We examine the relationship between immigration to Australia and the labour market outcomes of Australian-born workers. We use immigrant supply changes in skill groups, defined by education and experience, to identify the impact of immigration on the labour market. We find that immigration flows into those skill groups that have the highest earnings and lowest unemployment. Once we control for the impact of experience and education on labour market outcomes, we find almost no evidence that immigration harms the labour market outcomes of those born in Australia.