You are a finance minister in Iceland and are being pressured by labor unions to raise the corporate tax rate, which currently is 15 percent. They argue because it is among the lowest in the European Union it is "anti-labor." Using the labor market framework in the stylized DSGE model, tell them that lowering it even further would actually benefit labor.

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The Answer of You are a finance minister in Iceland and are being pressured by labor unions to raise the corporate tax rate, which currently is 15 percent. They argue because it is among the lowest in the European Union it is "anti-labor." Using the labor market framework in the stylized DSGE model, tell them that lowering it even further would actually benefit labor.

You Are a Finance Minister in Iceland and Are Being