The Finnish payroll tax cut experiment revisited, or where did the money go?

Ossi Korkeamäki ()
Authors registered in the RePEc Author Service: Ossi Korkeamäki

ERSA conference papers from European Regional Science Association

Abstract: In this paper I evaluate the effects of a regional experiment that reduced payroll-taxes by 3–6 percentage points of the firm's wage sum in Northern and Eastern Finland. I estimate the effect of the payroll-tax reduction on firms' employment, wage sum and profits, and on workers hourly pay and monthly hours worked, by comparing employment and wage changes before and after the start of the experiment to a control region. According to my results, the reduction in the payroll-taxes did not lead to any clear cut aggregate effects in the target region.

Date: 2011-09
New Economics Papers: this item is included in nep-acc, nep-lab and nep-pub
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Persistent link: https://EconPapers.repec.org/RePEc:wiw:wiwrsa:ersa11p898

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