Firm Heterogeneity and the Impact of Payroll Taxes

• Tác giả: Anikó Bíró
• Ngôn ngữ: eng
• Ký hiệu phân loại: 658.32 Compensation management
• Thông tin xuất bản: World Bank, Washington, DC, 2023
• Bộ sưu tập: Tài liệu truy cập mở
• ID: 242621
• Chủ đề: 1. FIRM HETROGENEITY; 2. LABOR MARKET; 3. OLDER WORKERS; 4. PAYROLL TAX; 5. TAX INCIDENCE

Tóm tắt

This paper studies the impact of a large payroll tax cut for older workers in Hungary. Motivated by the predictions of a standard equilibrium job search model, the paper examines the heterogeneous impact of the policy. Employment increases most at low-productivity firms offering low-wage jobs, which tend to hire from unemployment, while the effects are more muted for high-productivity firms offering high-wage jobs. At the same time, wages only increase at high-productivity firms. These results point to important heterogeneity in the incidence of payroll tax cuts across firms and highlight that payroll taxes have a significant impact on the composition of jobs in the labor market.