The social norm of unemployment suggests that aggregate unemployment reduces the well-being of the employed, but has a … the appropriate distinction may not be between employment and unemployment, but rather between higher and lower levels of … regional unemployment. However, the insecure employed and the poor-prospect unemployed are less negatively, or even positively …

This paper analyzes optimum income taxation in a model with endogenous job destruction that gives rise to unemployment …. It is shown that optimal tax schemes comprise both payroll and layoff taxes when the state provides public unemployment … amounts to the sum of unemployment benefits (that the state pays to unemployed workers) and payroll taxes (that the state does …