In this paper we discuss the influence of tax shifting on wages and employment. The paper is related to earlier research in this field, both for the Netherlands and for other European welfare states. Our approach differs since we pay explicit attention to the well-known theoretical result that it does not matter which side of the market is taxed (Dalton's Law). We will analyse the mechanisms behind tax shifting. Further we want to analyse whether a shift from employers' to employees' burden has an influence on wages and employment.The paper discusses the influence of taxes on wages and employment in various bargaining settings: the perfect competition model, right-to-manage models (including that of bilateral monopoly) and efficiency wage models are analysed. We conclude that the results depend on the framework that is used in the description of wage setting behaviour. The theorem that it is irrelevant which side of the market is taxed, does not hold for right-to-manage and efficiency wage models.In estimations for the Netherlands, the elasticity of wage costs with respect to employers' taxes is usually found to lie around 0.9, whereas the elasticity with respect to employees' taxes usually is found to lie around 0.4. This apparent violation of Dalton's Law has never been explained before. However, it can be explained from our analysis. Moreover, we show the importance of this result for the impact of a recent tax reform in the Netherlands on wages. 3rd June 1996We would like to thank Lex Borghans for his stimulating comments on an earlier version of this * paper. Further we are grateful to Egbert Jongen for his computational assistance. We thank the Netherlands Association of Science (NWO) for their financial support to this research.

No abstract

the modeling of the theoretical foundations of Schumpeter's innovative entrepreneur and the possibilities of an economic policy along Schumpetarian lines in contrast to a Keynesian policy. The book, published in 1984, is dedicated to the second question.It contains nine papers, divided into three groups. The first group consists of papers by Wolfgang F. Stolper and Fritz Neumark on the foundations ofa Schumpetarian economic policy. The second group numbers four papers by Wilhelm Krelle, Werner Meissnet, Manfred Neumann and Christian Seidl; the central theme is an analysis of the contrasts between the points of view of Schumpeter and Keynes and the consequences for economic policy. A fifth paper is added, a short doctrine-historical note on Schumpeter's theory by Erich Streissler~ The last group numbers two papers, one by Hans AIbach and one by John R. Meyer, on the results of empirical research about the innovating entrepreneur as a new test of Schumpeter's fascinating theories. Except for John Meyer all authors are Germans or Austrians. Meyer's paper is translated into the German language.The central question of the book is whether Keynes or Schumpeter should be the economist for the last decade of this century. Of course, a direct answer to the question doesn't make sense, but it is nevertheless a good question for a conference. It is short and each participant has the opporunity to develop his point of view as to the ideas of two the most outstanding economists of our century and to expose his ideas about the most promising economic policy for the period in question.Two aspects of Schumpeter's and Keynes' theory are repeatedly accentuated, the scope of the analyses and the time to be considered. Krelle mentions Keynes as a true economist; he didn't consider the interactions between economics and politics. Schumpeter on the contrary considered the social system as a whole (p. 68). Secondly, Keynes was interested primarily in short run problems, Schumpeter took the long view (p. 68). As to Stolper the main difference is that Schumpeter saw the economic system in a perennial change working to unknown equilibria in contrast to Keynes who saw the system working to an 'essentially unchanging equilibrium' (p. 7). Neumark stresses that Keynes saw order and technique as exogenous factors, in contrast to Schumpeter who hammered on the importance of endogenous changes in institutions and technique (p.

No abstract

No abstract