Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/39056 
Authors: 
Year of Publication: 
2010
Series/Report no.: 
CESifo Working Paper No. 3142
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
It is analyzed the impacts of outsourcing cost and wage tax progression under labor market imperfections with Nash wage bargaining and flexible outsourcing. With sufficiently strong (weak) labor market imperfection, lower outsourcing cost has a wage-moderating (wage-increasing) effect so that there is a negative (positive) effect on equilibrium unemployment. Higher tax progression, to keep the relative tax burden per worker constant, has a wage moderating and a positive effect on employment and negative effect on outsourcing.
Subjects: 
Nash wage bargaining
outsourcing
labor tax reform
JEL: 
H22
J41
J51
Document Type: 
Working Paper
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