Three Theorems on Inflation Taxes and Marginal Employment Subsidies
AbstractThe paper studies the micro-economics of inflation taxes and marginal employment subsidies. It proves under very weak assumptions (i) an inflation tax will reduce the long-run equilibrium wage or price and (ii) that a marginal employment subsidy will raise the long-run equilibrium employment level. The theorems are illustrated with examples. The paper also proves (iii) that in special circumstances a tax on inflation is exactly equilivalent to a marginal employment subsidy.
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Bibliographic InfoArticle provided by Royal Economic Society in its journal The Economic Journal.
Volume (Year): 94 (1984)
Issue (Month): 375 (September)
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Other versions of this item:
- Oswald, Andrew, 1982. "Three Theorems on Inflation Taxes and Marginal Employment Subsidies," The Warwick Economics Research Paper Series (TWERPS) 220, University of Warwick, Department of Economics.
- N00 - Economic History - - General - - - General
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- Andreas Knabe & Ronnie Schöb, 2007.
"Subsidizing Extra Jobs: Promoting Employment by Taming the Unions,"
FEMM Working Papers
07020, Otto-von-Guericke University Magdeburg, Faculty of Economics and Management.
- Andreas Knabe & Ronnie Schöb, 2007. "Subsidizing Extra Jobs: Promoting Employment by Taming the Unions," CESifo Working Paper Series 2130, CESifo Group Munich.
- Bijie Ren, 2008. "The regional effects of marginal wage subsidies," Psychometrika, Springer, vol. 3(4), pages 598-626, December.
- Mary C. Daly & Daniel J. Wilson, 2006. "Keeping up with the Joneses and staying ahead of the Smiths: evidence from suicide data," Working Paper Series 2006-12, Federal Reserve Bank of San Francisco.
- Alain de Crombrugghe & Gregory de Walque, 2011. "Wage and employment effects of a wage norm : The Polish transition experience," Working Paper Research 209, National Bank of Belgium.
- Schöb, Ronnie, 2007. "Soziale Grundsicherung und Beschäftigung," Discussion Papers 2007/12, Free University Berlin, School of Business & Economics.
- Andreas Knabe & Ronnie Schöb & Joachim Weimann, 2006. "Marginal Employment Subsidization: A New Concept and a Reappraisal," CESifo Working Paper Series 1707, CESifo Group Munich.
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