Labour Market Institutions and the Cohesion of the Middle Class
Abstract
We develop a simple model to study how relative wage rigidity affects equilibrium taxation. It is argued that relative wage rigidity, by compressing incomes within the middle class, leads to a lower degree of redistributive conflict within the politically important core of society, even though income inequality may increase for society as a whole. In the model, people vote first on wage rigidity and second on redistributive taxation. The rigid society has a lower tax rate than the flexible one. it is supported by the 'middle-class' in the first stage, while the poor, the rich and the unemployed suffer from it.(This abstract was borrowed from another version of this item.)
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Bibliographic Info
Paper provided by DELTA (Ecole normale supérieure) in its series DELTA Working Papers with number 95-30.Length: 11 pages
Date of creation: 1995
Date of revision:
Handle: RePEc:del:abcdef:95-30
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Related research
Keywords: LABOUR MARKET; TAX POLICY;Other versions of this item:
- Gilles Saint-Paul, 1996. "Labor market institutions and the cohesion of the middle class," International Tax and Public Finance, Springer, vol. 3(3), pages 385-395, July.
- Saint-Paul, Gilles, 1995. "Labour Market Institutions and the Cohesion of the Middle Class," CEPR Discussion Papers 1298, C.E.P.R. Discussion Papers.
- J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General
- J49 - Labor and Demographic Economics - - Particular Labor Markets - - - Other
- J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General
References
References listed on IDEASPlease report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Saint-Paul, Gilles, 1995.
"Some political aspects of unemployment,"
European Economic Review,
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- Saint-Paul, Gilles, 1994. "Some Political Aspects of Unemployment," CEPR Discussion Papers 949, C.E.P.R. Discussion Papers.
- Rodrik, Dani & Alesina, Alberto, 1994.
"Distributive Politics and Economic Growth,"
Scholarly Articles
4551798, Harvard University Department of Economics.
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- Gilles Saint-Paul, 1993.
"On the Political Economy of Labor Market Flexibility,"
NBER Chapters,
in: NBER Macroeconomics Annual 1993, Volume 8, pages 151-196
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- Saint-Paul, G., 1993. "On the Political Economy of Labor Market Flexibility," DELTA Working Papers 93-02, DELTA (Ecole normale supérieure).
- Saint-Paul, Gilles, 1993. "On the Political Economy of Labour Market Flexibility," CEPR Discussion Papers 803, C.E.P.R. Discussion Papers.
- Agell, Jonas & Lommerud, Kjell Erik, 1993. " Egalitarianism and Growth," Scandinavian Journal of Economics, Wiley Blackwell, vol. 95(4), pages 559-79, December.
- Wright, Randall, 1986. "The redistributive roles of unemployment insurance and the dynamics of voting," Journal of Public Economics, Elsevier, vol. 31(3), pages 377-399, December.
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- Persson, Torsten & Tabellini, Guido, 1994. "Is Inequality Harmful for Growth?," American Economic Review, American Economic Association, vol. 84(3), pages 600-621, June.
- Saint-Paul, Gilles & Verdier, Thierry, 1993.
"Education, democracy and growth,"
Journal of Development Economics,
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- Saint-Paul, Gilles, 1998. "A framework for analyzing the political support for active labor market policy," Journal of Public Economics, Elsevier, vol. 67(2), pages 151-165, February.
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Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- Maya Bacache-Beauvallet & Etienne Lehmann, 2008.
"Minimum wage or negative income tax: why skilled workers may favor wage rigidities,"
Spanish Economic Review,
Springer, vol. 10(1), pages 63-81, March.
- Bacache-Beauvallet, Maya & Lehmann, Etienne, 2005. "Minimum Wage or Negative Income Tax: Why Skilled Workers May Favor Wage Rigidities," IZA Discussion Papers 1570, Institute for the Study of Labor (IZA).
- Wasmer, Etienne, 1998.
"Labor Supply Dynamics, Unemployment and Human Capital Investments,"
Seminar Papers
651, Stockholm University, Institute for International Economic Studies.
- E Wasmer, 1998. "Labor Supply Dynamics, Unemployment and Human Capital Investments," CEP Discussion Papers dp0411, Centre for Economic Performance, LSE.
- Wasmer, E., 1998. "Labour Supply Dynamics, Unemployment and Human Capital Investments," Papers 651, Stockholm - International Economic Studies.
- Wasmer, Etienne, 2002. "Labor Supply Dynamics, Umemployment and Human Capital Investments," IZA Discussion Papers 463, Institute for the Study of Labor (IZA).
- Schob, Ronnie & Wildasin, David E., 2007.
"Economic integration and labor market institutions: Worker mobility, earnings risk, and contract structure,"
Regional Science and Urban Economics,
Elsevier, vol. 37(2), pages 141-164, March.
- Ronnie Schoeb & David E. Wildasin, 2001. "Economic Integration and Labor Market Institutions: Worker Mobility, Earnings Risk, and Contract Structure," Labor and Demography 0112002, EconWPA.
- Schöb, Ronnie & Wildasin, David, 2003. "Economic Integration and Labor Market Institutions: Worker Mobility, Earnings Risk, and Contract Structure," IZA Discussion Papers 945, Institute for the Study of Labor (IZA).
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