Resource title

Unemployment and labour market rigidities in OECD countries : the impact of taxes

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Resource description

This paper investigates unemployment and labour market rigidities in OECD countries in 1983?1994. The central issue is the taxation-unemployment relationship and whether this relationship is exogenous or simultaneously determined. Hausman specification tests indicate that the impact of taxation on short-term unemployment is positive and exogenous whereas the relationship between taxation and long-term unemployment is simultaneously determined. Correcting for this simultaneity results in a much higher, significant and positive regression coefficient for the impact of taxation. Thus, high taxation seems to be one of the main determinants of long-term unemployment.

Resource author

Bernhard Heitger

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Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/17919

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Adapt according to the presented license agreement and reference the original author.