Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/125812 
Year of Publication: 
2016
Series/Report no.: 
ZEW Discussion Papers No. 16-003
Publisher: 
Zentrum für Europäische Wirtschaftsforschung (ZEW), Mannheim
Abstract: 
This paper estimates the incidence of corporate taxes on wages using a 20-year panel of German municipalities. Administrative linked employer-employee data allows estimating heterogeneous worker and firm effects. We set up a general theoretical framework showing that corporate taxes can have a negative effect on wages in various labor market models. Using an event study design, we test the predictions of the theory. Our results indicate that workers bear about 40% of the total tax burden. Empirically, we confirm the importance of both labor market institutions and profit shifting possibilities for the incidence of corporate taxes on wages.
Subjects: 
business tax
wage incidence
administrative data
local taxation
JEL: 
H2
H7
J3
Persistent Identifier of the first edition: 
Additional Information: 
This paper is a completely revised version of ZEW Discussion Paper No. 13-039.
older Version: 
Document Type: 
Working Paper

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