Announcements

ECONOMICS SEMINAR -Hakkı Yazıcı

Author: CASE
Time: 16:00
Location: CAS 127

KOC UNIVERSITY

FACULTY OF ADMINISTRATIVE SCIENCES AND ECONOMICS

ECONOMICS SEMINAR

Wednesday,26 April ,2017

**************************************************************************************

Speaker  : Hakkı Yazıcı- Sabancı University

Title        : Taxation, Redistribution and Frictional  Labor Supply

Date        : 26 April  2017 -Wednesday

Time       : 16.00-17:30

Place      : CAS 127

Abstract: We analyze the implications of ex ante dispersion in worker talents and a frictional labor market for the design of tax systems. Our model features on and off the job search, job ladders and equilibrium income and profit dispersion within talent markets. In a baseline setting with no talent dispersion, the optimal system consists of an unemployment benefit financed out of a simple lump sum tax on workers. The benefit is high enough to suppress worker income and firm profit dispersion, deter worker poaching  and collapse job ladders. With talent dispersion, high benefit levels drive less talented workers out of the market and are prohibitively costly. Active talent markets are frictional. Taxes impact the dispersion of worker incomes and firm profits within these markets. These effects shape and modify conventional optimal tax formulas. Quantitative analysis implies that they create a motive for lower marginal tax rates.