The effect of taxes on labour in efficiency wage models: A comment.Faculty Publications
AbstractThis comment shows that some of Pisauro’s (Journal of Public Economics, 1991, 46, 329–345) reported results hold only if the unemployment rate exceeds 50%. If it does not, specific labor taxes reduce wages. Also, output falls when employment rises, all else equal, and minimum wage laws raise output.
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Citation InformationCarter, T. J. (1999). The effect of taxes on labour in efficiency wage models: A comment. Journal of Public Economics, 72(2), 325-327.