The implicit tax on working is less than 1% in the United States and over 2% in Belgium. Given this, we would expect:

Question

Quizplus · Accepted Answer

The lower implicit tax on working in the United States would make it more attractive for individuals to enter the labor force and work, as they would keep more of their earnings. Therefore, we would expect higher labor force participation in the United States compared to Belgium. Higher unemployment is not necessarily related to implicit tax on working.

The Implicit Tax on Working Is Less Than 1% in the United