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How to Measure the Tax Burden on Labour at the Macro-Level?

Author

Listed:
  • Jan-Egbert Sturm
  • Bjørn Volkerink
Abstract
The purpose of this paper is threefold. First, we survey the way in which the tax burden on labour has been proxied for in recent multi-country macro-economic studies. Second, we critically evaluate these proxies. Finally, we examine to what extent the conclusions of some studies change if some alternative indicator for the tax burden on labour is employed. We conclude that the widely used tax ratios as developed by Mendoza et al. (1994) may not be very reliable. The choice of the indicator for the tax burden on labour is also shown to affect the conclusions of some well-known empirical models.

Suggested Citation

  • Jan-Egbert Sturm & Bjørn Volkerink, 2003. "How to Measure the Tax Burden on Labour at the Macro-Level?," CESifo Working Paper Series 963, CESifo.
    • Handle: RePEc:ces:ceswps:_963
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    File URL: https://www.cesifo.org/DocDL/cesifo_wp963.pdf
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Pierre Salmon, 2003. "The assignment of powers in an open-ended European Union," Post-Print hal-00445601, HAL.
    2. Jeffrey Overall, 2017. "Practice what you preach: the failure of the welfare state and the discovery of total equality through capitalism," International Journal of Public Policy, Inderscience Enterprises Ltd, vol. 13(1/2), pages 69-85.
    3. Eichhorst, Werner & Feil, Michael & Braun, Christoph, 2008. "What have we learned? Assessing labor market institutions and indicators," IAB-Discussion Paper 200822, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    4. Marek Gora & Artur Radziwill & Agnieszka Sowa & Mateusz Walewski, 2006. "Tax Wedge and Skills: Case of Poland in International Perspective," CASE Network Reports 0064, CASE-Center for Social and Economic Research.
    5. Alexei Izyumov, 2010. "Human Costs of Post-communist Transition: Public Policies and Private Response," Review of Social Economy, Taylor & Francis Journals, vol. 68(1), pages 93-125.
    6. Primož Dolenc & Suzana Laporšek, 2012. "Taxing wages and sustainable labour market performance: empirical evidence from OECD and EU countries," International Journal of Sustainable Economy, Inderscience Enterprises Ltd, vol. 4(3), pages 234-253.
    7. Primoz Dolenc & Suzana Laporsek, 2012. "Labour Taxation and Its Impact on Employment Growth," Managing Global Transitions, University of Primorska, Faculty of Management Koper, vol. 10(3 (Fall)), pages 301-318.
    8. Jan Tecl, 2018. "Measurement of Labour Taxation," European Financial and Accounting Journal, Prague University of Economics and Business, vol. 2018(1), pages 5-18.
    9. Dreher, Axel, 2006. "The influence of globalization on taxes and social policy: An empirical analysis for OECD countries," European Journal of Political Economy, Elsevier, vol. 22(1), pages 179-201, March.
    10. Liliana E. Donath & Petru-Ovidiu Mura, 2019. "The Looming Central and Eastern European Real Convergence Club. Do Implicit Tax Rates Play a Part?," DANUBE: Law and Economics Review, European Association Comenius - EACO, issue 1, pages 67-89, March.
    11. International Monetary Fund, 2005. "Sweden: Selected Issues," IMF Staff Country Reports 2005/344, International Monetary Fund.
    12. Ana Grdoviæ Gnip & Iva Tomic, 2010. "How hard does the tax bite hurt? Croatian vs. European worker," Financial Theory and Practice, Institute of Public Finance, vol. 34(2), pages 109-142.
    13. Vladimir Gligorov & Anna Iara & Michael Landesmann & Robert Stehrer & Hermine Vidovic, 2008. "Western Balkan Countries: Adjustment Capacity to External Shocks, with a Focus on Labour Markets," wiiw Research Reports 352, The Vienna Institute for International Economic Studies, wiiw.
    14. Lucie Kábelová & Ondřej Bayer, 2018. "Labour Taxation and its Effect on Employment Growth: Latest Estimations with Focus on the Czech Republic," European Financial and Accounting Journal, Prague University of Economics and Business, vol. 2018(2), pages 45-57.
    15. Primož Dolenc & Suzana Laporšek, 2010. "Tax Wedge on Labour and its Effect on Employment Growth in the European Union," Prague Economic Papers, Prague University of Economics and Business, vol. 2010(4), pages 344-358.
    16. Peter Schwarz, 2007. "Does capital mobility reduce the corporate-labor tax ratio?," Public Choice, Springer, vol. 130(3), pages 363-380, March.
    17. Ms. Evridiki Tsounta, 2006. "Why Are Women Working So Much More in Canada? An International Perspective," IMF Working Papers 2006/092, International Monetary Fund.

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    More about this item

    Keywords

    tax ratios; labour; average effective tax rates; unemployment;
    All these keywords.

    JEL classification:

    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • H29 - Public Economics - - Taxation, Subsidies, and Revenue - - - Other

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