@techreport{Rocha-Akis2012pain,
abstract = {Over the previous two decades, many OECD countries have lowered the degree of progressivity in their tax structures. In this paper, I investigate labour tax progression in a world characterised by a segmented labour market where the higher-paying jobs are rationed due to (i) oligopolistic market structures, (ii) insider-oriented unions and (iii) international offshoring. In this second-best world, a revenue-neutral decrease in the progressivity of the tax schedule promotes higher domestic (net-of-tax) wage inequality where a shrinking fraction of workers provides the tax revenue to finance the redistribution to an increasing share of lower-wage workers. However, as the tax reform involves an increase in the offshoring intensity, which may translate into a cost advantage for the domestic average consumer, the overall welfare effect is ambiguous. It is shown that the negative effects dominate if trade unions are sufficiently insider-oriented.},
address = {M\"{u}nchen},
author = {Silvia Rocha-Akis},
copyright = {http://www.econstor.eu/dspace/Nutzungsbedingungen},
keywords = {L13; H20; F16; J50; 330; relocation; unionised oligopoly; labour market segmentation; labour income tax progression; trade union preferences; Lohnsteuer; Steuerprogression; Steuerwirkung; Lohnstruktur; Arbeitsmarktsegmentierung; Offshoring; Insider-Outsider-Modell; Gewerkschaftsmitgliedschaft; Wohlfahrtseffekt; Theorie},
language = {eng},
number = {3739},
publisher = {CESifo},
title = {The pain and gain of offshoring: The effects of tax progression in a segmented labour market},
type = {CESifo working paper: Labour Markets},
url = {http://hdl.handle.net/10419/55670},
year = {2012}
}
