Employer payroll taxes and money wage behaviour

Vroman, Wayne

doi:10.1080/00036847400000018

Cited by 28 publications

(14 citation statements)

References 12 publications

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“…For example, Gruber (1994Gruber ( , 1997 and Gruber and Krueger (1991), 1 Even for a single country, there is often a wide range of results. For example, for the U.S., Gordon (1972) finds full-shifting; Hamermesh (1979) and Vroman (1974) less-than-full-shifting, and Kaester (1996) finds no shifting for young workers. Hamermesh (1993), Blau and Kahn (1999) and Nickell and Layard (1999) provide excellent reviews of studies on the impact of payroll taxes for various countries as well as of crosscountry analyses.…”

Section: Introductionmentioning

confidence: 99%

Labor Market Effects of Payroll Taxes in Developing Countries: Evidence from Colombia

Kugler

Kügler

2009

Economic Development and Cultural Change

190

157

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We use a panel of manufacturing plants from Colombia to analyze how the rise in payroll tax rates over the 1980s and 1990s affected the labor market. Our estimates indicate that formal wages fall by between 1.4% and 2.3% as a result of a 10% rise in payroll taxes. This "less-than-full shifting" is likely to be the result of weak linkages between benefits and taxes and the presence of downward wage rigidities in Colombia. Because the costs of taxation are only partly shifted from employers to employees, employment also falls. Our results indicate that a 10% increase in payroll taxes lowered formal employment by between 4% and 5%. In addition, we find some evidence of less shifting and larger disemployment effects for production than for nonproduction workers. These results suggest that policies aimed at boosting the relative demand of less skilled workers by reducing social security taxes may be effective in Latin American countries, where minimum wages bind and benefits are often not directly linked to contributions. (c) 2009 by The University of Chicago. All rights reserved..

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Section: Introductionmentioning

confidence: 99%

Labor Market Effects of Payroll Taxes in Developing Countries: Evidence from Colombia

Kugler

Kügler

2009

Economic Development and Cultural Change

190

157

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“…Gordon (1971), on the contrary, suggests that employer contributions were shifted back to wages entirely. Vroman (1974) shows a result somewhere in between. All of these studies were conducted for the United States, and the results are quite varied.…”

Section: Payroll Tax Incidencementioning

confidence: 94%

The Role of Firms in Welfare Provision

Tachibanaki¹

2003

Labor Markets and Firm Benefit Policies in Japan and the United States

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“…The first is to estimate it based on the demand and supply for labour as given representatively by Brittain (1972), Hamermesh (1979), Beach and Balfour (1983) and Gruber and Krueger (1991). The second is based on the macroeconomic approach, or the Phillips curve approach, given representatively by Perry (1970), Gordon (1971), Vroman (1974) and Holmlund (1983). A brief summary of numerical evidence given in these studies can be found in Tachibanaki (2002).…”

Section: Introductionmentioning

confidence: 99%

The Estimation of the Incidence of Employer Contributions to Social Security in Japan*

Tachibanaki

Yokoyama²

2008

Japanese Economic Review

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The present paper estimates the incidence of the employer portion of social security contributions in Japan. One of the purposes of the paper is to examine whether the employer portion is shifted entirely or partly in many industrialized countries. The paper concludes, based on our estimation method, that there is very little apparent backwards shifting on to employees and, therefore, employers bear nearly all of their portion of social security contributions. Firms in Japan could use their contributions to social security for other purposes to reduce the financial burden on firms. JEL Classification Numbers: H22, J23, J30.

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Employer payroll taxes and money wage behaviour

Cited by 28 publications

References 12 publications

Labor Market Effects of Payroll Taxes in Developing Countries: Evidence from Colombia

Labor Market Effects of Payroll Taxes in Developing Countries: Evidence from Colombia

The Role of Firms in Welfare Provision

The Estimation of the Incidence of Employer Contributions to Social Security in Japan*

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