What are the impacts of labor tax reform on wage setting and employment to keep therelative tax burden per low-skilled and high-skilled workers constant in the case ofheterogenous domestic labor markets, i.e. imperfect competition in low-skilled labor andperfect competition in high-skilled labor...

We evaluate the effects of international outsourcing and labor taxation on wage formation and equilibrium unemployment in dual labor markets. Outsourcing promotes wage dispersion between the high-skilled and low-skilled workers. Higher domestic low-skilled wage tax, higher payroll tax and lower...

We analyze the following questions associated with outsourcing and profit sharing under imperfect labour markets. How does strategic outsourcing influence wage formation, profit sharing and employee effort when firms commit to optimal profit sharing before wage formation or decide for profit...