Charity and redistributive taxation in a unionized economy
AbstractEuropean economies are characterized by unionized labor markets and a pronounced governmental redistribution of income. This paper studies a model where those two features are combined with the possibility for individuals to make charitable contributions to the poor. The model exhibits equilibrium unemployment that increases with the degree of altruism. It is shown that a more progressive income tax can both reduce the unemployment rate and improve the public budget. These results are driven by charity increasing wage pressure and the altruistic rich failing to internalize the effect of their donations on the wage setting behavior of the unions. --
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. 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.
Bibliographic InfoPaper provided by Free University Berlin, School of Business & Economics in its series Discussion Papers with number 2006/21.
Date of creation: 2006
Date of revision:
Contact details of provider:
Postal: Garystr. 21, 14195 Berlin (Dahlem)
Phone: (030) 838 2272
Fax: (030) 838 2129
Web page: http://www.wiwiss.fu-berlin.de/en/index.html
More information through EDIRC
Equilibrium Unemployment; Income Tax; Charity; Trade Unions;
Other versions of this item:
- Corneo, Giacomo, 2008. "Charity and redistributive taxation in a unionized economy," Labour Economics, Elsevier, vol. 15(5), pages 831-843, October.
- J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General
- H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
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.:
- Ferris, J Stephen & West, Edwin G, 2003. " Private versus Public Charity: Reassessing Crowding Out from the Supply Side," Public Choice, Springer, vol. 116(3-4), pages 399-417, September.
- Koskela, Erkki & Vilmunen, Jouko, 1996. "Tax progression is good for employment in popular models of trade union behaviour," Labour Economics, Elsevier, vol. 3(1), pages 65-80, August.
- Stefan Bach & Giacomo Corneo & Viktor Steiner, 2005.
"Top Incomes and Top Taxes in Germany,"
Discussion Papers of DIW Berlin
532, DIW Berlin, German Institute for Economic Research.
- Lockwood, Ben & Manning, Alan, 1993. "Wage setting and the tax system theory and evidence for the United Kingdom," Journal of Public Economics, Elsevier, vol. 52(1), pages 1-29, August.
- Robert A Moffitt & Mark Wilhelm, 2000.
"Taxation and the Labor Supply - Decisions of the Affluent,"
Economics Working Paper Archive
414, The Johns Hopkins University,Department of Economics.
- Robert A. Moffitt & Mark Wilhelm, 1998. "Taxation and the Labor Supply: Decisions of the Affluent," NBER Working Papers 6621, National Bureau of Economic Research, Inc.
- Sandmo, Agnar, 1983. " Progressive Taxation, Redistribution, and Labor Supply," Scandinavian Journal of Economics, Wiley Blackwell, vol. 85(3), pages 311-23.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ZBW - German National Library of Economics).
If references are entirely missing, you can add them using this form.