Public Profit Sharing

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Public Profit Sharing

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Ronnie Schoeb ()

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Ronnie Schoeb

Abstract

Many countries suffer from persistently high unemployment rates. The scope for labour market reforms is often limited to measures that hurt neither shareholders nor workers. This paper develops a policy proposal, which allows the government to reduce wage costs without changing the income positions as determined in the process of wage negotiations. It is shown that the introduction of public profit sharing, i.e. substituting profit share for social security contributions, can boost employment both in the short run and the long run. Calibrating the model and comparing the results with recent empirical findings about the impact of labour taxation confirm the theoretical findings.

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Publisher Info
Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number CESifo Working Paper No. 489.

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Date of creation: 2001
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Handle: RePEc:ces:ceswps:_489

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Other versions of this item:

Article
- Schob, Ronnie, 2002. "Public Profit Sharing," Kyklos, Blackwell Publishing, vol. 55(4), pages 523-41.
Paper
- Ronnie Schöb, 2001. "Public Profit Sharing," UWO Department of Economics Working Papers 20012, University of Western Ontario, Department of Economics. [Downloadable!]

Find related papers by JEL classification:
C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General
J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects

References listed on IDEAS
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Other versions:
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Other versions:
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Nickell, Stephen & Layard, Richard, 1999. "Labor market institutions and economic performance," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 46, pages 3029-3084 Elsevier. [Downloadable!] (restricted)
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Other versions:
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Other versions:
- Erkki Koskela & Ronnie Schöb, . "Why Governments Should Tax Mobile Capital in the Presence of Unemployment," EPRU Working Paper Series 98-08, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics.
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Other versions:
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