This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

Employment Effects of a Payroll-Tax Cut: Evidence from a Regional Tax Exemption Experiment

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Ossi Korkeamäki
Roope Uusitalo

Additional information is available for the following registered author(s):

Abstract

In this paper we evaluate the effects of a regional experiment that reduced payroll taxes by 3-6 percentage points in Northern Finland for three years. We match each firm in the target region with a similar firm in the control region and estimate the effect of the payroll-tax reduction by comparing employment and wage changes within the matched pairs before and after the start of the experiment. According to our results the reduction in payroll taxes led to somewhat faster wage growth in the target region. The increase in wages offset roughly half of the impact of the payroll-tax cut on the labour costs. The remaining labour cost reduction had no significant effects on employment.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.vatt.fi/file/vatt_publication_pdf/k407.pdf
File Format: application/pdf
File Function:
Download Restriction: no
File URL: http://www.vatt.fi/publications/latestPublications/publication/Publication_1345_id/722
File Format: text/html
File Function:
Download Restriction: no

Publisher Info
Paper provided by Government Institute for Economic Research Finland (VATT) in its series Discussion Papers with number 407.

Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Length:
Date of creation: 21 Nov 2006
Date of revision:
Handle: RePEc:fer:dpaper:407

Contact details of provider:
Postal: Arkadiankatu 7, P.O. Box 1279, FI-00101 Helsinki
Phone: +358 40 304 5500
Fax: +358 9 4780 2929
Email:
Web page: http://www.vatt.fi/
More information through EDIRC

Order Information:
Email:

For technical questions regarding this item, or to correct its listing, contact: (Anita Niskanen).

Related research
Keywords: Payroll-tax; labour demand; tax incidence; propensity score matching;

Other versions of this item:

Find related papers by JEL classification:
J18 - Labor and Demographic Economics - - Demographic Economics - - - Public Policy
J58 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Public Policy
J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
J68 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Public Policy
J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
J65 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Unemployment Insurance; Severance Pay; Plant Closings

This paper has been announced in the following NEP Reports:

References listed on IDEAS
Please 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.:
  1. Johansen, F. & Klette, T.J., 1998. "Wage and Employment Effects of Payroll Taxes and Investment Subsidies," Memorandum 27/1998, Oslo University, Department of Economics.
    Other versions:
  2. Gruber, Jonathan, 1997. "The Incidence of Payroll Taxation: Evidence from Chile," Journal of Labor Economics, University of Chicago Press, vol. 15(3), pages S72-101, July. [Downloadable!] (restricted)
    Other versions:
Full references

Cited by:
(explanations, Please 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.)

  1. Tarmo Räty & Micke Bondas, 2008. "A Publication Activity Model for Finnish Universities," Discussion Papers 448, Government Institute for Economic Research Finland (VATT). [Downloadable!]
Statistics
Access and download statistics

Did you know? IDEAS also indexes books.

This page was last updated on 2009-11-13.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.