Ku, H;
Schoenberg, U;
Schreiner, R;
(2020)
Do place-based tax incentives create jobs?
Journal of Public Economics
, Article 104105. 10.1016/j.jpubeco.2019.104105.
(In press).
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Abstract
In this paper, we evaluate the effectiveness of place-based payroll taxes in stimulating local employment by exploiting a unique policy setting in Norway, where a system of geographically differentiated payroll taxes was suddenly abolished due to an EU regulation. The reform was enforced independently of the regional labor market developments, creating arguably exogenous variation in the payroll tax rates that firms in different local labor markets faced over time. We find evidence of partial shifting of payroll tax increases on to worker wages as well as a significant decline in local employment. These findings suggest that in settings with some degrees of wage rigidity, place-based payroll tax incentives can be effective in stimulating local employment.
| Type: | Article |
|---|---|
| Title: | Do place-based tax incentives create jobs? |
| Open access status: | An open access version is available from UCL Discovery |
| DOI: | 10.1016/j.jpubeco.2019.104105 |
| Publisher version: | https://doi.org/10.1016/j.jpubeco.2019.104105 |
| Language: | English |
| Additional information: | This is an open access article under the CC BY-NC-ND license (http:// creativecommons.org/licenses/by-nc-nd/4.0/). |
| UCL classification: | UCL UCL > Provost and Vice Provost Offices > UCL SLASH UCL > Provost and Vice Provost Offices > UCL SLASH > Faculty of S&HS UCL > Provost and Vice Provost Offices > UCL SLASH > Faculty of S&HS > Dept of Economics |
| URI: | https://discovery.ucl.ac.uk/id/eprint/10077362 |
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