http://repub.eur.nl/res/concept/jel-D58/ Recent publications classified by JEL Code D58 en http://repub.eur.nl/static-eur/img/logo.png http://repub.eur.nl http://repub.eur.nl/res/pub/11769/ 2008-02-01T00:00:00Z European governments aim to raise labour supply, cut unemployment and, at the same time, maintain social cohesion. Yet, economists have stressed the trade-off between these objectives. This paper reviews the key policy insights from optimal tax theory to identify options for reform in the tax-benefit system that can potentially improve the equity-efficiency trade-off. Using a comprehensive applied general equilibrium model, we then explore whether reforms along these lines in the Dutch tax-benefit system raise employment without sacrificing equality. The analysis reveals that selective tax relief for elastic secondary earners and low-skilled workers have this potential. A flat income tax structure, possibly combined with a negative income tax, worsens the equity-efficiency trade-off. Mooij, R.A. de http://repub.eur.nl/res/pub/10441/ 2007-05-30T00:00:00Z This paper analyzes the impact of corporate taxes on structural unemployment, using an applied general equilibrium model for the European Union. We find that the unemployment and welfare effects of corporate taxes differ considerably among European countries. The magnitude of these effects rise in particular in the broadness of the corporate tax base of a country, and the strength of international spillover effects through foreign direct investment. The effect on unemployment is smaller if the substitution elasticity between labour and capital is large, if international spillover effects operate primarily via multinational profit shifting, and if equilibrium forces on the labour market are strong. Although the effect of corporate taxes on unemployment may be smaller than the effect of labour and value-added taxes (e.g. under relatively strong real wage resistance), the welfare costs of corporate taxation are typically larger for most European countries under plausible parameters, especially under strong international spillovers. Bettendorf, L.J.H. Horst, A. van der Mooij, R.A. de http://repub.eur.nl/res/pub/893/ 2003-09-16T00:00:00Z The ageing baby-boom generations in the OECD economies will have an impact on the global supply and demand of capital over the next decades. The size and direction of this impact have been the subject of much research, which we survey. We study the effects of alternative interest rate paths for the Dutch economy with the IMAGE general equilibrium model, emphasizing developments of the current account. Further simulations explore the sensitivity of the outcomes to alternative demographic projections, tax smoothing and exogenous participation increases. We find that tax smoothing is not the appropriate policy to generate a more equitable intergenerational distribution when changes in the world interest rate are taken into consideration. Bettendorf, L.J.H. Knaap, T. http://repub.eur.nl/res/pub/1952/ 2000-01-01T00:00:00Z This paper develops an applied general equilibrium model to explore various tax cuts aimed at combating unemployment and raising labor supply. The model calibrates modern labor-market theories on wage setting, job matching, labor supply and labor demand on Dutch data. It represents the core of a larger applied general equilibrium model for the Netherlands called MIMIC. Simulations reveal that targeting in-work benefits at the low skilled is the most effective way to cut economy-wide unemployment. However, targeting is likely to damage the quality and quantity of labor supply. Tax cuts in the higher tax brackets boost the quantity and quality of formal labor supply but are less effective in reducing unemployment and in raising unskilled employment and female labor supply. Bovenberg, A.L. Graafland, J.J. Mooij, R.A. de