Scandinavian Working Papers in Economics
Working Papers,
Örebro University, School of Business
No 2008:5: Net Taxes,Income Stabilization and Regional Job Flows in Sweden
Linda Andersson ()
Additional contact information
Linda Andersson: Department of Business, Economics, Statistics and Informatics, Postal: Örebro University, Swedish Business School, SE - 701 82 ÖREBRO, Sweden
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
26 pages, June 12, 2008
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