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dc.contributor.authorRøed, Knuten_US
dc.contributor.authorStrøm, Steinaren_US
dc.date.accessioned2012-09-20T13:14:15Z-
dc.date.available2012-09-20T13:14:15Z-
dc.date.issued1999en_US
dc.identifier.urihttp://hdl.handle.net/10419/63071-
dc.description.abstractDoes an income tax harm economic efficiency more the more progressive it is? Public economics provides a strong case for a definite ‘yes’. But at least three forces may pull in the other direction. First, low-wage workers may on average have more elastic labour supply schedules than high-wage workers, in which case progressive taxes contribute to a more efficient allocation of the total tax burden. Second, in noncompetitive labour markets, progressive taxes typically encourage wage moderation, and hence reduce the equilibrium level of unemployment. And third, if wage setters have egalitarian objectives, progressive taxes may reduce the need for redistribution in pre-tax wages, and hence increase the demand for low-skilled workers. This paper surveys the theoretical, as well as the empirical literature about labour supply, taxes and wage setting. We conclude that in a second best world, the trade-off between equality and efficiency is not always inevitable.en_US
dc.language.isoengen_US
dc.publisherDep. of Economics, Univ. of Oslo Osloen_US
dc.relation.ispartofseriesMemorandum, Department of Economics, University of Oslo 1999,19en_US
dc.subject.jelH24en_US
dc.subject.jelJ30en_US
dc.subject.jelJ58en_US
dc.subject.ddc330en_US
dc.subject.keywordTax progressivityen_US
dc.subject.keyworddead-weight lossen_US
dc.subject.keywordredistributionen_US
dc.subject.stwSteuerprogressionen_US
dc.subject.stwEinkommensteueren_US
dc.subject.stwAllokationseffizienzen_US
dc.subject.stwEinkommensumverteilungen_US
dc.subject.stwArbeitsmarkten_US
dc.subject.stwTheorieen_US
dc.titleProgressive taxes and the labour market: Is the trade-off between equality and efficiency inevitable?en_US
dc.typeWorking Paperen_US
dc.identifier.ppn323423647en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen_US
Appears in Collections:Memorandum, Department of Economics, University of Oslo

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