Net Taxes,Income Stabilization and Regional Job Flows in Sweden

Linda Andersson Järnberg

No 2008:5, Working Papers from Örebro University, School of Business

Abstract: The objective of this paper is to empirically analyze the relationship between job flows and regional income stabilization provided by the national tax and transfer systems. The analysis is based on an administrative panel data set containing all sectors in 20 Swedish regions for the time period 1989-2000. Controlling for unobserved regional effects we find that a high net tax-income ratio tends to decrease the rate of jobs that are created and increase the rate of job destruction, increasing the overall rate of job reallocation in the regions. In an attempt to separate out the part of the national tax-transfer system that is aimed at stabilizing the income path over time we find that only job creation is affected, i.e., regions where the income path is more stable tend to have a lower rate of intra-industry job creation.

Keywords: income (search for similar items in EconPapers)
JEL-codes: H24 J63 J68 (search for similar items in EconPapers)
Pages: 26 pages
Date: 2008-06-12
New Economics Papers: this item is included in nep-geo and nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:hhs:oruesi:2008_005

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