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We evaluate the effects of international outsourcing and labor taxation on wage formation and equilibrium unemployment in dual labor markets. Outsourcing promotes wage dispersion between the high-skilled and low-skilled workers. Higher domestic low-skilled wage tax, higher payroll tax and lower...
Persistent link: https://www.econbiz.de/10013325133
on lower decreasing returns to scale and/or more intensive product market competition. Finally, we show that the steady …
Persistent link: https://www.econbiz.de/10013325204