Sarah Gharbi

Sarah Gharbi

I am a PhD candidate at the University of Cologne.

Publications

Redesigning Taxes to Increase Economic Activity? Evidence from a French Business Tax Reform (JMP) PDF

single-authored

Empirical evidence of input-based taxes is scarce. I exploit a reform of the French local business tax that shifted the tax burden from both labor and capital to capital only. I apply a dynamic differences-in-differences approach leveraging cross-sectional variations in firms‘ exposure to the reform. Using rich administrative data, I show that the reform boosts firms‘ investment, particularly for those initially cash-constrained. For a 1% reduction in taxes, tangible assets increase by 0.43%. This generates significant productivity gains. Wages are not affected. I estimate a negative effect on employment. This reduction does not indicate direct job cuts but reflects differences in employment growth rates between capital-intensive and labor-intensive firms, with capital-intensive firms increasing employment more rapidly. I explain this difference by varying tax sensitivity based on whether firms can deduct business tax payments from the corporate income tax.

Unpacking the Small Effects of Subsidized Employment: the Role of Gender and Parenthood PDF

with Valentina Melentyeva and Eloïse Menestrier

Subsidized employment has been widely used to tackle the prevalent problem of youth unemployment. In this study, we evaluate the impact of a subsidized employment program for disadvantaged youth in France and reveal significant gender differences in program effectiveness, hidden behind the average null effect. For men, the effects are significant and positive on all employment outcomes, on both extensive and intensive margins. In contrast, for women, the program fails to improve the likelihood of employment. We identify two reasons for such differences in program effectiveness. First, women are more likely to have children during the program and drop out of it. Second, we observe gender-based sorting into different job types at the start of subsidized employment. Men tend to secure cognitive tasks in public administration and industry, while women are likely to occupy routine non-cognitive roles in health and social services. Our results have important implications for future policy designs and evaluations.