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Title: Which Democracies Pay Higher Wages?
Authors: Rockey, James
Makris, Miltiadis
First Published: Nov-2010
Publisher: Dept. of Economics, University of Leicester
Abstract: The labor share of income varies markedly across the set of democracies. A model of the political process, situated in a simple macroeconomic environment is analyzed in which the cause of this variation is linked to di erences in the form of democracy - in particular the adoption of a presidential or parliamentary system. Presidential regimes are associated with lower taxation but lower wages. Robust evidence for the negative impact of a presidential system on the labor share is obtained using a Bayesian Model Averaging approach. Evidence is also provided that this is due to lower taxation.
Series/Report no.: Papers in Economics;11/09
Type: Report
Appears in Collections:Reports, Dept. of Economics

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