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Union strategy and optimal income taxation
[Gewerkschaftsstrategie und optimale Einkommensteuer]

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  • Kessing, Sebastian G.
  • Konrad, Kai A.

Abstract

Restrictions on work hours are more important in countries with a large welfare state. We show that this empirical observation is consistent with the strategic effects of such restrictions in a welfare state in the context of optimal direct taxation in the tradition of Mirrlees (1971). Our results also apply to nonwelfarist states which have income redistribution, but not in purely extortionary states.

Suggested Citation

  • Kessing, Sebastian G. & Konrad, Kai A., 2005. "Union strategy and optimal income taxation [Gewerkschaftsstrategie und optimale Einkommensteuer]," Discussion Papers, Research Unit: Market Processes and Governance SP II 2005-04, WZB Berlin Social Science Center.
    • Handle: RePEc:zbw:wzbmpg:spii200504
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    References listed on IDEAS

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    More about this item

    Keywords

    Optimal income taxation; labor unions; work hours;
    All these keywords.

    JEL classification:

    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies

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