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Taxation and unemployment: an applied general equilibrium approach

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  • Bohringer, Christoph
  • Boeters, Stefan
  • Feil, Michael

Abstract

We present an applied general equilibrium modelling approach to analyse employment and unemployment effects of labour tax cuts in an economy where wages are determined through firm-union bargaining at the sectoral level. In such a labour market regime, simulations for Germany show that labour tax policies can make only a small contribution to alleviating the problem of persistent unemployment.
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  • Bohringer, Christoph & Boeters, Stefan & Feil, Michael, 2005. "Taxation and unemployment: an applied general equilibrium approach," Economic Modelling, Elsevier, vol. 22(1), pages 81-108, January.
    • Handle: RePEc:eee:ecmode:v:22:y:2005:i:1:p:81-108
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