Employment and Taxes
AbstractThis paper considers the impact of taxation policy on market work. On the basis of theevidence, we find that a 10 percentage point rise in the tax wedge will reduce overall labourinput provided via the market by around 2 per cent of the population of working age. The taxwedge is the sum of the payroll, income and consumption tax rates.This only explains a minority of the market work differentials across count ries. Muchof the remainder is probably down to the differences in the social security systems supportingthe unemployed, the sick and disabled and the early retired.
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Bibliographic InfoPaper provided by Centre for Economic Performance, LSE in its series CEP Discussion Papers with number dp0634.
Date of creation: May 2004
Date of revision:
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Web page: http://cep.lse.ac.uk/_new/publications/series.asp?prog=CEP
Employment; Taxation; Labour Supply;
Other versions of this item:
- H2 - Public Economics - - Taxation, Subsidies, and Revenue
- J2 - Labor and Demographic Economics - - Demand and Supply of Labor
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-01-02 (All new papers)
- NEP-LAB-2005-01-02 (Labour Economics)
- NEP-LTV-2005-01-02 (Unemployment, Inequality & Poverty)
- NEP-PUB-2005-01-02 (Public Finance)
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