Income Tax and Labour supply is an important part in public sector Economics. Income tax affects labour supply which in turn affects the national income. Economic theory cannot predict the effect of tax on Labour supply, because are in opposite directions. This research is concerned with the effect substitution and income effects of taxation on labour supply by an econometric study of cross-sectional data. It is assumed that the effect of taxation is to alter budget constraints. Because different individuals have different gross wage rates and different amounts of other income, they have different budget constraints. If difference in preferences are adequately controlled for, it is possible to derive labour supply estimates from the cross-sectional data which can then be used as basis for estimating the effect of taxation. In this study we show that the effects of net wage rate on labour supply is significant, that non wage income is not significant. We finally recommend a policy for tax refoRm by changing the marginal tax rate.

Despite the belief of many economic scholars, women have played a significant role in the industrialization process of communities. Unfortunately, although women have the necessary competence to accept society responsibilities, inappropriate behavior and discriminatory is imposed to them and this problem has caused the women's participation rate slower than the participation rate of men. As women's economic participation rate is the measure of progress and development in developed and developing nations, the issue of women's economic participation is of great importance. This study aims at estimating the women’s participation in Iranian economy using macroeconomic data and econometric method of panel data. Results show that women's economic participation rate in 28 provinces of Iran is affected by the main variable of wage rate and also by the control variables such as gross domestic production per capita, unemployment rate etc. Results also show that increasing the share of industrial and agricultural sectors in supplying new occupations has positive effect on women’s participation while an increase in the share of services sector in the supply of new occupations has a negative effect.