Various taxes influence wage and employment outcomes in efficiency wage models. These findings are extended by incorporating more comprehensive tax functions, additional tax parameters, union-firm wage bargaining, and balanced budget restrictions. Moreover, the importance of different effort...

Redundany payments for collective dismissals are incorporated into a Shapiro-Stiglitz model of efficiency wages. it is shown, that a fixed payment will lower wages, leave employment and welfare unaffected if there are no wage-dependent taxes, no additionalfiring costs and if unemployment...

Unemployment remains a major problem for economic policy at the beginning of the millennium. Taxes and Unemployment investigates how tax policy affects labor market outcomes in industrialized countries and to what extent it can be used to combat unemployment. In particular, the wage and...

Redundancy payments for collective dismissals are incorporated into a Shapiro-Stiglitz model of efficiency wages. It is shown that a fixed payment will lower wages, leave employment and welfare unaffected if there are no wage-dependent taxes, no additional firing costs and if unemployment...

More progressive income taxes raise employment in models of imperfectly competitive labour markets. However, this prediction is not robust to modifications of the analytical structure. For example, in an efficiency wage setting, more progressive taxes reduce profits. This induces firms to exit...

In this paper fiscal policy is examined for an open economy characterised by unemployment due to efficiency wages. We allow for capital and firm mobility in a model where the government chooses the level of wage, source-based capital and profit taxation. The taxing choices of governments are...

We analyse the implications of habit formation relating to wages in a multi-period efficiency-wage model. If employees have such preferences, their existence provides firms with incentives to raise wages and reduce employment over time. Greater intensity does not necessarily have the same...

We analyse the implications of habit formation relating to wages in a multi-period efficiency-wage model. If employees have such preferences, their existence provides firms with incentives to raise wages and reduce employment over time. Greater intensity does not necessarily have the same...