Dear Alan,

Were I your correspondent, rather than attempting to wriggle out of things
with claims of cherry-picking I would make the point that higher
employment rates (which by definition mean higher rates of people who can
be found by the government and made to pay tax) enable higher taxation and
government spending, relative to GDP.

The data for the most obvious outlier, India, which has a large rural
sector and lots of informal employment, illustrates the point most fully.

Note that the other most notable outliers are Turkey, Greece and Mexico,
all of which in various ways differ rather strongly from the rest of the
countries covered here.

You would then reply that this demonstrates nothing either way in relation
to the point at issue, which is whether in a *given* country, with
whatever economic structure and social/institutional set-up it has, a bit
more tax will lead to a few jobs more, or less.

Some would argue that the question is not "more tax, or less" but "lower
wages, or higher". See the work of my colleague Engelbert Stockhammer
(just Google "stockhammer wage-led growth").



Best wishes,

Julian Wells



Dr Julian Wells
Director of Studies
Department of Economics
 
staff web-page: http://fass.kingston.ac.uk/staff/cv.php?staffnum=287
personal web-site: http://staffnet.kingston.ac.uk/~ku32530
 
Principal lecturer in economics
School of Economics, History and Politics
Faculty of Arts and Social Sciences
Kingston University
Penrhyn Road
Kingston-upon-Thames
KT1 2EE
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+44 (0)20 8417 2341
 



On 10/02/2013 15:17, "Alan Sloan" <[log in to unmask]> wrote:

>Hi people,
>
>I'm a new poster here.  I joined because although I'm not a
>statistician I work in face to face data collection and of course I
>also have an interest in the way statistics are used to inform/mislead
>me in my everyday information environment.
>
>I am looking for help to explain some email exchanges I had on utube
>where my correspondent (apparently he has a masters in Economics so he
>should have some idea)  insisted that taxes cost jobs.  I checked the
>OECD countries for % in employment and plotted the results against %
>of national gdp, and found what appears to be a trend for higher
>taxation to correlate with higher employment.  My correspondent
>blankly refused to address my data, saying I'm cherry-picking (I
>attempted to do the reverse, looking for the largest dataset of
>cosistent quality)
>
>I dont know if my perception of trend (a 5% decrease in tax take
>appears to correlate with a 20% decrease in employment) is valid at
>all in statistical terms.  Nor am I aware of a more competent or
>proper analysis of the tax vs jobs debate, any pointers would be
>appreciated.
>
>Anyway, am I missing something basic here?
>
>I'm going to try to attach my excel spreadsheet for reference - but
>I'm not sure if this list will accept it, lets see....
>
>Alan
>
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