NDLI: Redistribution and employment in frictional labor markets *

Content Provider	Semantic Scholar
Author	Hummel, Albert Jan
Copyright Year	2018
Abstract	This paper analyzes optimal taxation when search frictions generate unemployment and labor supply responds along both the intensive (hours) and extensive (participation) margin. I characterize optimal tax rules in terms of the observable income distribution and sufficient statistics. Search frictions have an ambiguous effect on optimal taxes. High marginal tax rates reduce wage pressure, which lowers unemployment. High average taxes have the opposite effect. The first (second) of these effects calls for higher (lower) tax rates. JEL classification: H21, J38, J65, J68
File Format	PDF HTM / HTML
Alternate Webpage(s)	https://www.albertjanhummel.com/wp-content/uploads/2018/09/jmp_draft.pdf
Language	English
Access Restriction	Open
Content Type	Text
Resource Type	Article

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