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competitors excessive, assuming labor productivity to depend on the number of employees only or to be constant. However, a firm …
Persistent link: https://www.econbiz.de/10012015904
In an efficiency wage economy with variable profits, a shift from payroll to employment taxes will reduce unemployment if the tax level is held constant at the initial wage. However, unemployment will rise if firms are constrained to zero profits in the long-run and if tax revenues are constant....
Persistent link: https://www.econbiz.de/10011333288
It is often argued that the quantity which is traded on the market is independent of the side of the market which is taxed. However, this assertion need not hold, especially in imperfectly competitive markets like that for labour. Taking an efficiency wage economy as an example, it is shown that...
Persistent link: https://www.econbiz.de/10011313941
In order to alleviate unemployment it is often recommended to reduce social security contributions (SSC) and to compensate for the ensuing loss in revenues by a rise in the value-added tax (VAT). Assuming unemployment to be caused by efficiency wages, it is shown that a balanced-budget shift...
Persistent link: https://www.econbiz.de/10011313955
In a unionised labour market, a substitution of a payroll for an income tax will not alter employment if tax obligations are fulfilled. However, if workers or firms can evade taxes this irrelevance result might no longer apply. This will especially be the case if the fine for tax evasion depends...
Persistent link: https://www.econbiz.de/10011404003
Persistent link: https://www.econbiz.de/10001829804
We study the efficiency and distributional consequences of establishing and abolishing the draft in a dynamic model with overlapping generations, taking into account endogenous human capital formation as well as government budget constraints. The introduction of the draft initially benefits the...
Persistent link: https://www.econbiz.de/10002747990
Persistent link: https://www.econbiz.de/10002120356
This paper analyzes simultaneous voting on the wage tax rate and investment in public education with three overlapping generations and productivity differences inside each cohort. Wage tax revenue finances public education and social security benefits. The presence of productivity differences...
Persistent link: https://www.econbiz.de/10002501914
Government-run entities are often more labor-intensive than private companies, even with identical production … firms. A tax-favored treatment of public production precludes production efficiency. It reduces welfare when labor supply is … constant. With an elastic labor supply, a wage tax advantage of the public sector may improve welfare if it allows for a higher …
Persistent link: https://www.econbiz.de/10002504341