The Influence of Labor Taxes on the Migration of Skilled Workers
This paper investigates empirically the role of taxes on labor for the stock of expatriates and the migration flows of skilled workers. Given the increasing mobility of labour, especially of high-skilled people and expatriates, it is interesting to see to what extent labour income taxes and social security contributions determine migration flows. We collect data on personal income tax profiles for 49 economies and the year 2002. In particular, we determine the component of labor taxes which is borne by employers and the one that is borne byemployees, following the OECD’s Taxing Wages Approach. For the latter, we calculate the progressivity of personal income tax rates between the average wage and five times the average wage. This may be interpreted as the tax progression which is relevant for well-paid workers. Then, we use the personal income tax variables to estimate their effect on bilateral stocks of expatriates into OECD countries and the migration of skilled workers into these countries. Personal income tax rates turn out to have a robust negative effect on cross-border flows of skilled workers in the OECD.
|Date of creation:||2008|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +49 (89) 9224-0
Fax: +49 (89) 985369
Web page: http://www.cesifo.de
More information through EDIRC
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.:
- Daniel Chiquiar & Gordon H. Hanson, 2005.
"International Migration, Self-Selection, and the Distribution of Wages: Evidence from Mexico and the United States,"
Journal of Political Economy,
University of Chicago Press, vol. 113(2), pages 239-281, April.
- Daniel Chiquiar & Gordon H. Hanson, 2002. "International Migration, Self-Selection, and the Distribution of Wages: Evidence from Mexico and the United States," NBER Working Papers 9242, National Bureau of Economic Research, Inc.
- Heckman, James, 2013.
"Sample selection bias as a specification error,"
Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
- Lars P. Feld & Gebhard Kirchgässner, 2000.
"Income Tax Competition at the State and Local Level in Switzerland,"
CESifo Working Paper Series
238, CESifo Group Munich.
- Feld, Lars P. & Kirchgassner, Gebhard, 2001. "Income tax competition at the State and Local Level in Switzerland," Regional Science and Urban Economics, Elsevier, vol. 31(2-3), pages 181-213, April.
- George J. Borjas, 1994. "The Economics of Immigration," Journal of Economic Literature, American Economic Association, vol. 32(4), pages 1667-1717, December.
- Kirchgassner, Gebhard & Pommerehne, Werner W., 1996. "Tax harmonization and tax competition in the European Union: Lessons from Switzerland," Journal of Public Economics, Elsevier, vol. 60(3), pages 351-371, June.
- Thomas Liebig & Alfonso Sousa-Poza, 2004. "Migration, Self-Selection and Income Inequality: An International Analysis," Kyklos, Wiley Blackwell, vol. 57(1), pages 125-146, 02.
- Jeffrey Grogger & Gordon H. Hanson, 2008.
"Income Maximization and the Selection and Sorting of International Migrants,"
NBER Working Papers
13821, National Bureau of Economic Research, Inc.
- Grogger, Jeffrey & Hanson, Gordon H., 2011. "Income maximization and the selection and sorting of international migrants," Journal of Development Economics, Elsevier, vol. 95(1), pages 42-57, May.
- Christopher Heady, 2003. "The "Taxing Wages" Approach to Measuring the Tax Burden on Labour," CESifo Working Paper Series 967, CESifo Group Munich.
When requesting a correction, please mention this item's handle: RePEc:ces:ceswps:_2462. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Julio Saavedra)
If references are entirely missing, you can add them using this form.