In this paper we argue that, for a given overall level of labour income taxation, a more progressive tax schedule … increases employment. From a theoretical point of view, higher progressivity increases overall employment through a wage … moderating effect and also because employment of low-paid workers is more elastic to wages. We test these theoretical predictions …

average wage, we show that a more progressive taxation reduces the unemployment rate and increases the employment rate. These …This paper argues that, for a given overall level of labour income taxation, a more progressive tax schedule reduces … the unemployment rate and increases the employment rate. From a theoretical point of view, higher progressivity induces a …