This paper deals with optimal income taxation under labor outsourcing and FDI. We show how the optimal income tax … response to the joint effect of outsourcing and FDI depends on whether FDI is complementary with, or substitutable for …, domestic labor. -- outsourcing ; foreign direct investment ; optimal nonlinear taxation …

outsourcing, wage tax and tax exemption in an imperfectly competitive labour markets when labour unions and firms negotiate wages … and the impacts of labour tax progression on domestic wage setting and employment. The wage elasticity of domestic labour … imperfections a lower outsourcing cost has a wage-moderating (wage-increasing) effect. Finally, increasing the degree of tax …

firms as outsourcing costs fall. With respect the impact of labor tax reforms that are well-established in the literature …: changes in the wage tax rate, the tax exemption and the unemployment benefit payments affect domestic wage setting in the same … way as in the absence of outsourcing. Furthermore, increasing the degree of tax progression by keeping the relative tax …

more competitive. To focus on this aspect, we analyze how flexible international outsourcing and labour taxation affect … wage tax progression of unskilled workers decreases the wage rate and increases the labour demand of unskilled workers. It …. -- Flexible outsourcing ; dual labour market ; impacts of labour taxation ; welfare state …

-skilled workers is more competitive. To focus on this aspect, we analyze how flexible international outsourcing and labour taxation …-skilled workers. Increasing wage tax progression of lowskilled workers decreases the wage rate and increases the labour demand of low … of firms. -- Flexible outsourcing ; dual labour market ; impacts of labour taxation ; welfare state …

We study the effects of revenue-neutral labor tax reforms in an imperfectly competitive domestic labor market under … Nash wage bargaining and flexible outsourcing. A revenue-neutral increase in the wage tax progression will decrease the … negotiated wage rate, increase domestic labor demand and decrease international outsourcing. In the presence of wage tax …