Unemployment, Growth and Taxation in Industrial Countries

  title={Unemployment, Growth and Taxation in Industrial Countries},
  author={Francesco Daveri and G. Tabellini},
  journal={Labor eJournal},
  • Francesco Daveri, G. Tabellini
  • Published 1997
  • Economics
  • Labor eJournal
  • To the layperson, the upward trend in European unemployment is related to the slowdown in economic growth. We argue that the layperson’s view is correct. The increase in European unemployment and the slowdown in economic growth are related because they stem from a common cause: an excessively high cost of labour. In Europe, labour costs have gone up for many reasons, but one is particularly easy to identify: higher taxes on labour. If wages are set by strong and centralized trade unions, an… CONTINUE READING
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