Reducing social contributions on unskilled labour as a way of fighting unemployment: An empirical evaluation for the case of Spain
AbstractIn this paper we provide an empirical evaluation of the effects of a cut in social security contributions (i) for all types of labour, and (ii) only for unskilled labour, within a computable general equilibrium model simulated for the Spanish economy. The model allows firms to follow a non-competitive price rule, and incorporates an equal yield assumption, which means that the reduction in social security contributions is compensated with an increase in value-added tax rates, so that the public sector deficit is not affected. In addition, the labour market is assumed to follow a matching unemployment rule, which allows to model in a simple way any frictions present in that market.
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Bibliographic InfoPaper provided by FEDEA in its series Studies on the Spanish Economy with number 107.
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- Óscar Bajo Rubio & Antonio Gómez Gómez-Plana, 2001. "Reducing social contributions on unskilled labour as a way of fighting unemployment: An empirical evaluation for the case of Spain," Documentos de Trabajo - Lan Gaiak Departamento de EconomÃa - Universidad PÃºblica de Navarra 0102, Departamento de Economía - Universidad Pública de Navarra.
- D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
- H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-07-18 (All new papers)
- NEP-EEC-2001-10-16 (European Economics)
- NEP-LAB-2001-10-16 (Labour Economics)
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