Lehmann, Etienne (contributor); … - 2008
compensated increase in tax progressivity renders a higher
pre-tax wage less attractive to workers, a lower pre-tax wage is … substituted for a lower after-tax
wage.2 This wage moderation e�ect of tax progressivity stimulates labor demand and reduces …�ort) is the only source of deadweight losses.
In this competitive labor market model, tax progressivity induces a downward …