This paper studies optimal linear and nonlinear redistributive income taxation when there is adverse selection in the labor market. Unlike in standard taxation models, firms do not know workers' abilities and competitively screen them through nonlinear compensation contracts. The equilibrium...

This paper extends the Diamond (1980) model with labor unions to study optimal income taxation and to analyze whether unions can be desirable for income redistribution. Unions bargain with firms over wages in each sector and firms unilaterally determine employment. Unions raise the efficiency...

This paper extends the Diamond (1980) model with labor unions to study optimal income taxation and to analyze whether unions can be desirable for income redistribution. Unions bargain with firms over wages in each sector and firms unilaterally determine employment. Unions raise the efficiency...

It has been argued recently that imposing taxes on pollution produces additional tax revenues, which can then be used to replace labor taxes and thus reap a double dividend in the form of improving environmental quality and alleviating unemployment. This paper analyzes the employment effects of...

During the last decade, several EU countries have tried to tackle unemployment and low activity rates through extensive tax cuts. In an effort to encourage the taking up of work - especially amongst the less productive workers - policymakers have shown increasing interest in targeted tax and...

The paper discusses two approaches to spatial equilibrium in the labor market. The more traditional approach of labor economics assumes wage differentials represent arbitrageable differences in utility, with implications 1) that migration should be toward higher wage areas and 2) that migration...

"This paper examines efficiency in public input provision in two large jurisdictions with imperfect labour markets. It analyses how equilibrium capital tax rates and public input provision levels differ between asymmetric jurisdictions that can strategically influence the interest rate on the...

We analyze the quantitative labor market and aggregate effects of a carbon tax in a framework with pollution externalities and equilibrium unemployment. Our model incorporates endogenous labor force participation and two margins of adjustment influenced by carbon taxes: firm creation and green...