Average Labor Taxes and Unemployment: Evidence from Italian Regions
AbstractBy focusing on the Italian experience, we ask whether the relationship between labor taxes and unemployment varies across regions. In spite of similar national labor market institutions, we show that this relationship is significantly stronger in the highly industrialized North than in the less developed South, where unemployment is much higher. An important source of variation in the regional responsiveness of unemployment originates from the fact that regional gross wages in the North increase more than in the South in response to a hike in labor taxes.
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Bibliographic InfoPaper provided by University of Molise, Dept. EGSeI in its series Economics & Statistics Discussion Papers with number esdp03011.
Length: 30 pages
Date of creation: 19 Oct 2003
Date of revision:
regional unemployment; labor taxes.;
Find related papers by JEL classification:
- J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
- H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2003-10-28 (All new papers)
- NEP-LAB-2003-10-28 (Labour Economics)
- NEP-LTV-2003-10-28 (Unemployment, Inequality & Poverty)
- NEP-PBE-2003-10-28 (Public Economics)
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