Accounting for labor gaps
François Langot
(1, 2, 3)
,
Alessandra Pizzo
(4)
François Langot
- Fonction : Auteur
- PersonId : 1356941
- IdHAL : francois-langot
- ORCID : 0000-0001-7737-5319
- IdRef : 059336536
Alessandra Pizzo
- Fonction : Auteur
- PersonId : 967096
- IdRef : 167339389
Résumé
This study explains the impact of taxes and labor market institutions on the total hours observed in France, Germany, the United Kingdom, and the United States. We develop a balanced growth model with matching frictions in the labor market distinguishing between the extensive margin and intensive margin of labor supply. We show that (i) hours are more sensitive to changes in taxes, whereas employment reacts more to shifts in labor market institutions and (ii) a substitution effect exists between employment and hours. Counterfactual experiments show that if France had experienced the same trend in labor market institutions as the United States, its employment rate would have increased by 25 percentage points, whereas its number of hours worked per employee would have reduced by 1 percentage point. If France had chosen the US’ paths of both taxes and labor market institutions, then its employment rate would have been larger by 20 percentage points and the number of hours worked by employees would have been larger by 3 percentage points than the current one, a situation observed before the 1970s.
Domaines
Economies et financesFormat du dépôt | Notice |
---|---|
Type de dépôt | Article dans une revue |
Titre |
en
Accounting for labor gaps
|
Résumé |
en
This study explains the impact of taxes and labor market institutions on the total hours observed in France, Germany, the United Kingdom, and the United States. We develop a balanced growth model with matching frictions in the labor market distinguishing between the extensive margin and intensive margin of labor supply. We show that (i) hours are more sensitive to changes in taxes, whereas employment reacts more to shifts in labor market institutions and (ii) a substitution effect exists between employment and hours. Counterfactual experiments show that if France had experienced the same trend in labor market institutions as the United States, its employment rate would have increased by 25 percentage points, whereas its number of hours worked per employee would have reduced by 1 percentage point. If France had chosen the US’ paths of both taxes and labor market institutions, then its employment rate would have been larger by 20 percentage points and the number of hours worked by employees would have been larger by 3 percentage points than the current one, a situation observed before the 1970s.
|
Auteur(s) |
François Langot
1, 2, 3
, Alessandra Pizzo
4
1
PSE -
Paris School of Economics
( 301309 )
- 48 boulevard Jourdan 75014 Paris
- France
2
PJSE -
Paris Jourdan Sciences Economiques
( 1171428 )
- 48 boulevard Jourdan 75014 Paris
- France
3
GAINS -
Groupe d'Analyse des Itinéraires et des Niveaux Salariaux
( 198500 )
- Université du Maine - Avenue Olivier Messiaen - 72085 Le Mans cedex 9
- France
4
UCHILE -
Universidad de Chile = University of Chile [Santiago]
( 142796 )
- Av. Libertador Bernardo O'Higgins 1058, Santiago de Chile
- Chili
|
Public visé |
Scientifique
|
Langue du document |
Anglais
|
Nom de la revue |
|
Vulgarisation |
Non
|
Comité de lecture |
Oui
|
Audience |
Internationale
|
Date de publication |
2019-09
|
Volume |
118
|
Page/Identifiant |
312-347
|
Mots-clés (JEL) |
|
Domaine(s) |
|
Mots-clés |
en
Taxes, Labor market institutions, Hours, Employment, Labor market search
|
DOI | 10.1016/j.euroecorev.2019.05.018 |
UT key WOS | 000485209400018 |
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