The incidence of payroll taxation: Evidence from chile. 09 级劳动经济学 张素蓉. Background . Fact: the increase in payroll taxation burden … OECD countries: 19% to 25% from 1965-88 Sweden: 6% to 40% by the late from 1950 - 1970s
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The incidence of payroll taxation:Evidence from chile
OECD countries: 19% to 25% from 1965-88
Sweden: 6% to 40% by the late from 1950 - 1970s
Or, does payroll tax certainly lead to labor market efficiency?
(w0, E0) TO (W1, E1)
The incidence :
elasticity of DL and SL
the minimum wage
shifting may not be possible
survey of manufacturing plants in Chile over 1979-1986
firm-level data( employees > 10)
Basic regression specification:
Cross-sectional regression: difference in difference
Average difference estimator: the difference of the average over the 1979-1980 period and the 1984-1985 period
1) Recession in the 1980s: wage decreased dramatically, unemployment increased, high inflation(25%)
Employers were mandated to give an 18% nominal wage rise due to the “privatization
The confounding influence of employee contributions:
reduction in tax rate causes an increase in employee’s contribution
w may include employee’s contribution, when (dw/w)/dtewould NOT be zero!