TY  - RPRT
        AU  - Guggenberger, Patrik
AU  - Kaul, Ashok
AU  - Kolmar, Martin
        TI  - Efficiency Properties of Labor Taxation in a Spatial Model of Restricted Labor Mobility
        PY  - 2001/Apr/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 287
        UR  - https://www.iza.org/publications/dp287
        AB  - We examine the efficiency properties of labor taxation. A spatial model of an economy is introduced whose key feature is a new approach to restricted labor mobility. We characterize the efficient allocation of labor and properties of a decentralized equilibrium. An efficient allocation of labor can be compatible with marginal productivity differentials stemming from binding mobility restrictions. We investigate two scenarios of labor taxation (firm-specific taxes and country-specific taxes) and in both setups we give a complete characterization of the cases for which there is scope for redistribution without affecting effciency. Finally, we discuss the applicability of our model in the context of the place of employment and place of residence principle of taxation.
        KW  - Restricted Labor Mobility
KW  - Efficient Allocation of Labor
KW  - Labor Taxation
        ER  -