Unemployment and tax design

• 成果类型: Article
• 署名作者: Hummel, Albert Jan
• 署名单位: Tinbergen Institute; University of Amsterdam; Leibniz Association; Ifo Institut
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/j.jpubeco.2025.105359
• 发表日期: 2025
• 关键词: Directed search; optimal taxation

摘要

This paper studies optimal income taxation in an environment where matching frictions generate a trade-off for workers between high wages and low unemployment risk. A higher marginal tax rate shifts the trade-off in favor of low unemployment risk, whereas a higher tax burden or unemployment benefit has the opposite effect. Changes in unemployment generate fiscal externalities, which modify optimal tax formulas. A calibration exercise to the US economy suggests that optimal marginal tax rates and employment taxes are hardly affected if unemployment responses to taxation are taken into account.