For Western countries today an important issue is the extent to which high taxes and high benefits act as a disincentive to work. This accessible study by a team of economists, led by the distinguished A B Atkinson, explores the effects of welfare benefits on the economy. Data from the countries of Germany, Denmark, Sweden, and the UK are used. The countries of Northern Europe have high taxes, arid benefit levels well above the average for the industrialised world. The current debate on changes to the welfare state depends upon different views of the effect of these welfare benefits, and the taxes necessary to finance them, on the working of the economy. This volume analyses the possible disincentive effects on the labour supply of such taxes and benefits. Atkinson and Morgensen have produced a unified comparative study of the microeconomic process whereby high taxes and high benefits act as disincentives to work. This volume also considers the macroeconomic issue of attempting to equalize tax receipts and benefit expenditure. The study compares Sweden, the UK, Germany and Denmark, provides much useful empirical evidence and discussion of the different labour market institutions of those countries, and will be accessible to non-economists.
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