In European Welfare States, low-skilled workers are typically unionized, while the wage formation of high-skilled workers is more competitive. To focus on this aspect, we analyze how flexible international outsourcing and labour taxation affect wage formation, employment and welfare in dual domestic labour markets. Higher productivity of outsourcing, lower cost of outsourcing and lower factor price of outsourcing increase wage dispersion between the high-skilled and low-skilled workers. Increasing wage tax progression of lowskilled workers decreases the wage rate and increases the labour demand of low-skilled workers. It decreases the welfare of low-skilled workers and increases both the welfare of high-skilled workers and the profit of firms.
|Keywords||No keywords specified (fix it)|
|Categories||categorize this paper)|
References found in this work BETA
No references found.
Citations of this work BETA
No citations found.
Similar books and articles
The Ethical Agendas of Employment Agencies Towards Migrant Workers in the UK: Deciphering the Codes. [REVIEW]Chris Forde & Robert MacKenzie - 2010 - Journal of Business Ethics 97 (S1):31-41.
Trading Jobs for Health: Ionizing Radiation, Occupational Ethics, and the Welfare Argument.Kristin Shrader-Frechette - 2002 - Science and Engineering Ethics 8 (2):139-154.
Temporary Labour Migration, Global Redistribution, and Democratic Justice.P. T. Lenard & C. Straehle - 2012 - Politics, Philosophy and Economics 11 (2):206-230.
Help the Low Skilled or Let the Hardworking Thrive? A Study of Fairness in Optimal Income Taxation.Francois Maniquet - manuscript
Emigrants - Itinerant Workers - Guest Workers. Population, Labour Market and Migration in Germany Since the Mid-Nineteenth Century.Konrad Fuchs - 1985 - Philosophy and History 18 (2):143-144.
Added to index2009-01-28
Total downloads6 ( #560,090 of 2,171,698 )
Recent downloads (6 months)1 ( #326,424 of 2,171,698 )
How can I increase my downloads?