English, Article, Journal or magazine article edition: Optimal Income Taxation in an Equilibrium Unemployment Model : Mirrlees meets Pissarides Mathias, HUNGERBUELHER; Etienne, LEHMANN; Alexis PARMENTIER; ...

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Bookmark: http://trove.nla.gov.au/version/178737
Physical Description
  • preprint
Language
  • English

Edition details

Title
  • Optimal Income Taxation in an Equilibrium Unemployment Model : Mirrlees meets Pissarides
Author
  • Mathias, HUNGERBUELHER
  • Etienne, LEHMANN
  • Alexis PARMENTIER
  • Bruno VAN DER LINDEN
Physical Description
  • preprint
Notes
  • This paper characterizes optimal non-linear income taxation in an economy with a continuum of unobservable productivity levels and endogenous involuntary unemployment due to frictions in the labor markets. Redistributive taxation distorts labor demand and wages. Compared to the laissez-faire, gross wages, unemployment and participation are lower. Average tax rates are increasing. Marginal tax rates are positive, even the top. Finally, numerical simulations suggest that redistribution is much more important in our setting than in a comparable Mirrlees (1971) setting.
  • Optimal Income Taxation; Unemployment; Wage Bargaining; Matching
  • RePEc:ctl:louvir:2003024
Language
  • English
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