The response of labour taxation to changes in government debt

Nadine Leiner-Killinger, Michal Slavík and Fédéric Holm-Hadulla

No 1307, Working Paper Series from European Central Bank

Abstract: This paper investigates the relationship between government debt and labour taxation for a panel of 18 EU countries over the period 1979-2008. The econometric estimates point to a statistically significant and economically relevant positive response of labour taxation to changes in the general government debt and interest expenditure-to-GDP ratios. The results are robust across a range of econometric specifications and labour tax indicators. JEL Classification: H2, H24, H63, J22

Keywords: Debt; fiscal adjustment; labour taxes (search for similar items in EconPapers)
Date: 2011-03
New Economics Papers: this item is included in nep-cba, nep-eec, nep-eur, nep-pbe and nep-pub
Note: 564550
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Persistent link: https://EconPapers.repec.org/RePEc:ecb:ecbwps:20111307

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