Outsourcing and Labor Taxation in Dual Labor Markets

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Outsourcing and Labor Taxation in Dual Labor Markets

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dc.contributor.author Koskela, Erkki en_US
dc.contributor.author Poutvaara, Panu en_US
dc.date.accessioned 2009-02-04T10:28:16Z
dc.date.available 2009-02-04T10:28:16Z
dc.date.issued 2008-12-05T00:00:00Z en_US
dc.identifier.uri http://hdl.handle.net/10398/7697
dc.description.abstract We evaluate the effects of international outsourcing and labor taxation on wage formation and equilibrium unemployment in dual labor markets. Outsourcing promotes wage dispersion between the high-skilled and low-skilled workers. Higher domestic low-skilled wage tax, higher payroll tax and lower wage tax exemption increase optimal outsourcing. Outsourcing will reduce equilibrium unemployment of low-skilled workers both in the presence and absence of labor taxation. In the presence of outsourcing, wage tax, tax exemption and payroll tax have an ambiguous effect on equilibrium unemployment. Increasing the degree of tax progression decreases the wage rate and increases the demand of low-skilled workers. en_US
dc.format.extent 41 S. en_US
dc.language eng en_US
dc.relation.ispartofseries Working paper;2008-09 en_US
dc.title Outsourcing and Labor Taxation in Dual Labor Markets en_US
dc.type wp en_US
dc.accessionstatus modt08dec05 nijemo en_US
dc.contributor.corporation Copenhagen Business School. CBS en_US
dc.contributor.department Centre for Economic and Business Research en_US
dc.contributor.departmentshort CEBR en_US
dc.contributor.departmentuk Centre for Economic and Business Research en_US
dc.contributor.departmentukshort CEBR en_US
dc.idnumber x656557388 en_US
dc.publisher.city København en_US
dc.publisher.year 2008 en_US


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