Bonus contracts are predominant in management remuneration. These contracts reward managers with variable payments in case of satisfactory performance. However, penalty contracts, which punish target failure with financial deductions, could be a competitive alternative. Nevertheless, they do not...

The paper studies simple strategies of labor tax reform in a search and matching model of the labor market featuring endogenous labor supply. Changing the composition of the tax wedge - that is, reducing a payroll tax and increasing a progressive wage tax such that the marginal tax wedge remains...

To the layman, the upward trend in European unemployment is related to the slowdown in economic growth. We argue that the layman's view is correct. The increase in European unemployment and the slowdown in economic growth are related because they stem from a common cause: an excessively high...

We document for the US and Continental Europe that home-production time remained essentially flat during the last 50 years while changes in market time and leisure offset each other. We then focus on the US and France during 1970-2005 which are on the opposite sides of the spectrum: while US...

Using a new tax on fringe benefits initiated in India in 2005, this paper seeks evidence for the hypothesis that the difference in higher marginal tax rates on wages, relative to lower rates on fringe benefits, induces a reallocation of the total compensation package toward fringe benefits....

This paper analyzes the implications of effective taxation of labor for profits and, hence, the location decision of a multinational enterprise. We set up a stylized partial equilibrium model and, presuming that worker effort is a function of net wages, assume that a higher employee-borne tax...

International comparisons of minimum-wage levels have largely focused on minimum wages before tax, ignoring the effects of taxation on both labour costs and the net income of employees. This paper presents estimates of the tax burdens facing minimum-wage workers. Results show the evolution of...

International comparisons of minimum-wage levels have largely focused on the gross value of minimum wages, ignoring the effects of taxation on both labour costs and the net income of employees. This paper presents estimates of the tax burdens facing minimum-wage workers. These are used as a...