Download or read book Three Essays on the Economic Effects of Tax Policy written by Inga Bethmann and published by . This book was released on 2017 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Three Essays on the Effect of Taxes on Economic Behavior written by Anil Kumar and published by . This book was released on 2004 with total page 172 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Three Essays on the Effect of Taxes and Tax Reform on the Life cycle Labor Supply written by James Patrick Ziliak and published by . This book was released on 1993 with total page 422 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book The Economics of Tax Policy written by Alan J. Auerbach and published by Oxford University Press. This book was released on 2017 with total page 401 pages. Available in PDF, EPUB and Kindle. Book excerpt: "Debates about the optimal structure for tax policies and tax rates hardly cease among public, policy, or academic audiences. These have only grown more heated in the United States as the gap between incomes of the wealthiest 1 percent and the rest of the population continue to diverge. Tax research perhaps has not fully kept pace with the relentless demand of various interests to adjust tax policy. Nonetheless, specialists in the economics of tax policy in recent years have profited from advances in economic theory, econometric measurements, and data quality and access that are beginning to allow a greater consensus on what are the real effects of tax policy and how government levies affect individuals and businesses. The volume edited by Professors Auerbach and Smetters represents an attempt to reduce the lag between the conduct of research on tax issues and its transmission to a broader public. The contributions would explore highly topical issues such as the effects of income tax changes on economic growth, the potential effects of capping certain tax expenditures, the economics of adjusted business tax policy, and environmental tax options. Other essays would investigate perennially important themes such as the conduct of tax administration, the growing role of the tax system on education policy, tax policy toward low-income families, capital gains and estate taxation, and tax policy for retirement savings. A final paper would examine three different options for fundamental tax reform"--

Download or read book Three Essays on the Effect of Taxes on Firm and Individual Behavior written by Stacy Dickert-Conlin and published by . This book was released on 1996 with total page 300 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Three Essays on the Impacts of Income Taxes written by David Matthew Powell (Ph. D.) and published by . This book was released on 2009 with total page 169 pages. Available in PDF, EPUB and Kindle. Book excerpt: (cont.) Because governments can tax labor income separately from capital income, it is critical to isolate the tax elasticity of labor income. Furthermore, governments can use non-linear taxes so the mean elasticity :is not the relevant statistic. In this chapter, I introduce a new quantile estimator useful for panel data and applicable in an IV context. I find evidence of significant heterogeneity in the compensated elasticity. The importance of this heterogeneity is most evident for men as the elasticity is much larger at the top quantiles. The elasticity also appears to be larger at lower quantiles for both men and women.

Download or read book Three Essays in Public Economics written by Christian Rafael Jaramillo Herrera and published by . This book was released on 2005 with total page 344 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Three Essays on the Implications of Limited Attention in Economics written by Jérémy Boccanfuso and published by . This book was released on 2020 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation is a collection of three essays on the economic implications of limited attention. It is supplemented with a general introduction (Chapter 1).The first chapter introduces an ongoing paradigm shift in the macroeconomic literature from full-information rational expectations to rationally inattentive economic agents. It then presents some characteristics of this new class of models and current challenges in the literature that motivates the work in this dissertation.The second chapter is a contribution to consumption theory. It studies the consumption-saving problem of a consumer who faces a fixed cost for paying attention to noisy information and whose attention strategy, i.e., whether or not she pays attention, can be a function of the underlying information. At the optimum, consumers chose to be at- tentive when evidence accumulates far from their prior beliefs. The model provides an explanation for four puzzling empirical findings on consumption and expectations. First, consumers' attention depends on the information content. Second, aggregate information rigidities vary over the business cycle. Third, consumers only react to large anticipated shocks and neglect the impact of small ones. Fourth, aggregate consumption dynamics vary over the business cycle. The third chapter is a theoretical contribution to the literature in behavioral public economics. It studies how information frictions in agents' tax perceptions affect the design of actual tax policy. Developing a positive theory of tax policy, it shows that agents' inattention interacts with policymaking and induces the government to implementinefficiently high tax rates. It then quantifies the magnitude of this policy distortion for the US economy. Overall, the findings suggest that existing information frictions - and thereby tax complexity - lead to undesirable, large and regressive tax increases.The fourth chapter is an empirical contribution to the macroeconomic literature on information frictions. Using the ECB survey of professional forecasters, it estimates a two margin forecast formation process that allows for forecast rounding on individual and consensus forecast data. Forecasters decide when to revise their forecast (extensive margin). When they do, they slowly incorporate new information (intensive margin) and may report a rounded value for their new forecast (rounding). It finds that these three rigidities simultaneously exist and estimate their respective contribution. The overall forecast stickiness is almost exclusively the consequence of the rigidities at the intensive margin. It then derives quarterly time series for the evolution of information frictions and proposes a simple mapping to account for these variations in economic models.

Download or read book Three Essays in Public Economics written by Christopher Luke Watson and published by . This book was released on 2021 with total page 209 pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation is composed of two chapters on the economy-wide effects of the Earned Income Tax Credit and one chapter on the effects of monopolistic market structure in urban rental markets. Each chapter considers unintended consequences of public actions given an interconnected market place. For chapter this is skill substitutability, chapter two spatial connections, and chapter three preferences and market power.Chapter one studies the general equilibrium incidence of the Earn Income Tax Credi by formalizing the theoretical mechanisms and quantifying its empirical importance. The Earned Income Tax Credit is a $67 billion tax expenditure that subsidizes 20\\% of all workers. Yet all prior analysis uses partial equilibrium assumptions on gross wages. I derive the general equilibrium incidence of wage subsidies and quantify the importance of EITC spillovers in three ways. I calculate the GE incidence of the 1993 and 2009 EITC expansions using new elasticity estimates. I contrast the incidence of counterfactual EITC and Welfare expansions. I quantify the effect of equalizing the EITC for workers with and without children. In all cases, I find spillovers are economically meaningful relative to the intended direct effects.Chapter two studies the county level labor market effects of state supplements to the Earned Income Tax Credit.Twenty eight states spend $4 billion to supplement the federal Earned Income Tax Credit, with several justifying the tax expenditure as a pro-work incentive. Yet no systematic evaluation of these supplements exists. I use state border policy variation to identify state supplements effects. I first document that subsidy rates are greater when a state's neighbor already has a supplement. Next, I assess whether supplements affect county level EITC take-up, migration, commuting, employment, and earnings. Estimates are sensitive to the estimation design and sample used. While supplements increase benefits to low-income workers, results fail to provide robust evidence of increased economic activity.Chapter three is joint with Oren Ziv. We investigate the sources, scope, and implications of landowner market power in New York City rental markets. We show how zoning regulations generate spillovers through increased markups and derive conditions under which restricting landownership concentration reduces rents. Using new building-level data from New York City, we find that a 10% increase in ownership concentration in a Census tract is correlated with a 1% increase in rent.Market power is substantial: on average, markups account for nearly a third of rents in Manhattan. Furthermore, pecuniary spillovers between zoning constraints and markups at other buildings are appreciable. Up-zoning that results in 417 additional housing units at zoning-constrained buildings reduces markups on policy-unconstrained units and generates between 5 and 19 additional units through increased competition.

Download or read book When Good Economics Makes Good Politics written by Andréa M. Maechler and published by . This book was released on 1999 with total page 402 pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation presents three essays, which illustrate how sound economic analysis generates politically sustainable policy outcomes. The objective is to set political issues in economic contexts which are appropriate to the real world structure.

Download or read book Three Essays on U S Tax and Transfer Programs written by Amanda Ryan Eng and published by . This book was released on 2021 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation is comprised of three essays that explore the impacts of tax and transfer programs for low-income households. In the first chapter, coauthored with Kevin Rinz, we study how income affects the take up of means-tested programs. Pro-work policies usually decrease household participation in traditional safety-net programs like the Supplemental Nutrition Assistance Program (SNAP) and the Temporary Assistance for Needy Families (TANF) program. This negative relationship could be driven by newly working households becoming more self-sufficient or by decreased eligibility and higher costs to participate in the programs. Understanding which of these factors drives the negative relationship between income and program participation is important for understanding the mechanisms driving take-up decisions and for designing effective policies. However, the designs of SNAP and TANF make it difficult to distinguish these factors. In this paper, we estimate how demand for SNAP and TANF changes with income, holding eligibility and take-up costs constant. We use a discontinuity in child tax benefits, which do not affect program eligibility, to isolate the effect of income on program participation. We additionally show evidence that take-up costs are the same for households on either side of the discontinuity. We find that although eligibility for tax credits decreases households' tax liability by \$2,219 on average, the additional income results in no measurable difference in program participation. These findings suggest that the negative correlation between income and program take-up is driven by households losing eligibility or facing greater participation costs and that there could be significant benefits to expanding eligibility for these programs to more working households. In the second chapter, coauthored with Jordan Matsudaira, we study how Pell Grants affect students' success in higher education. The Pell Grant program is the largest federal program aimed at lowering the cost of higher education for low-income students. Most prior work has found that Pell grants have little or no effect on students' success, but recently Denning et al. (2019) estimate that Pell grants significantly increased completion rates and post-college earnings for four-year college students in Texas. These conflicting findings may be driven by the fact that previous studies are limited to specific states or school systems. In our paper, we estimate the average effect of Pell on student outcomes across a much broader swath of higher education than has been examined in the literature to date. We use administrative data covering the universe of federal aid recipients. Our research design makes use of discontinuities and kinks in the Pell grant schedule to estimate how additional grant aid affects students' outcomes. We find that the effect of Pell on completion rates and post-college earnings are much weaker than the estimates of Denning et al. (2019). We argue that this difference may be partly the result of interactions between Pell grants and a particularly generous state aid program in Texas. Our findings underscore the importance of understanding how aid programs like Pell grants interact with the larger financial aid system. In the final chapter, I investigate the macroeconomic effects of the Earned Income Tax Credit (EITC). The EITC has been shown to significantly increase labor force participation and much of the credit is spent instead of saved. These two effects could result in medium to long run growth of the economy. Additionally, because the EITC is distributed when households file their taxes around February and March, it particularly increases consumption around these months and could shift the timing of economic activity within a year. I use simulated instruments and a variety of estimation methods to explore how the EITC affects state-level economic indicators. I find that the EITC has large effects on both employment and state GDP in the medium run, with only weak evidence that it impacts the timing of economic activity during the year. From these analyses, I conclude that the main way the EITC affects the broader economy is by promoting growth.

Download or read book Three essays on the economics and econometrics of taxation written by Jon Marijan Bakija and published by . This book was released on 2000 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Economic Consequences of Public Policies in China written by Zhigang Li and published by . This book was released on 2005 with total page 222 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Three Essays in Macroeconomics of Fiscal and Monetary Policies written by and published by . This book was released on 2015 with total page 102 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Three Essays in Public Finance written by Abdulkadir Nagac and published by . This book was released on 2009 with total page 214 pages. Available in PDF, EPUB and Kindle. Book excerpt: Taxes are major source of public funds to finance government expenditures. Tax authorities impose different kind of taxes and employ many agents to collect taxes effectively. Some dutiful taxpayers will undoubtedly pay their tax liabilities while many others will not. The Internal Revenue Service in the United States reports that the estimate of income tax liability not collected is about 17, which translates into 345 billion for 2001. It is important to make a distinction between tax evasion and tax avoidance. The distinguishing characteristic of evasion is illegality. Whether the reason for not paying tax liability is avoidance or evasion, economic models of taxation need to be changed in the light of these realities. In this study, I analyze some of the economic problems of tax evasion/avoidance. In the first chapter, I discuss the relationship between number of tax audits, tax administration reform and tax compliance in Turkey. In recent years, many developing countries have carried out reforms in their tax administration to increase their efficiency in collecting taxes. In 2005, the tax authority in Turkey established Tax Office Directorates (T.O.D.s) in 29 provinces for the purpose of controlling the underground economy, improving taxpayer assistance, and increasing auditing efficiency. By using the panel data on province level tax returns, my analysis answers two questions. First, I examine the effect of audits on reported income and reported tax liability. By controlling for the detectibility of evasion and other socioeconomic variables, I find that audits have the same effectiveness in increasing reported income and reported tax liability. Second, I investigate the effect of establishing T.O.D.s in 29 provinces on compliance in those provinces. I find that T.O.D.s are effective at the extensive margin rather than the intensive margin. Thus, establishing T.O.D.s had no significant effect on the compliance level of existing taxpayers while it increased the number of tax returns significantly. In the second chapter, I analyze the excess burden on income tax when tax avoidance matters. I present a simple static labor supply model with endogenous asset choice. Then, I examine how tax avoidance through asset trading a ects the labor supply response and the excess burden of income tax. Furthermore, I discuss the implications of the tax policy analysis and show that a failure to account for avoidance responses may lead to errors when estimating how tax reform affects labor supply, tax revenue, and the welfare cost of taxation. Because of tax avoidance through tax arbitrage, the progressivity of a given tax system will be less than what the formal tax system implies. In the third chapter, we study the Marginal Cost of Funds in the existence of tax evasion. We develop a general equilibrium model of tax evasion, including the expected utility of taxpayers and three different revenue-raising government policies. In this rich model environment, we analytically derive the marginal cost of funds (MCF) for the alternative policy instruments. We consider two main fiscal reforms: the revision in the nonlinear tax scheme and the changes in enforcement mechanism (the audit and penalty rates). First, we derive the MCF for the tax reform and find its key determinants. The derived MCF is greater than the previous ones since it includes a "risk-bearing cost" as well as tax distortion. The reform in enforcement mechanism generates MCFs in different forms. Two more MCFs with respect to audit and penalty rates are presented. Finally, we compare these three different MCFs in numerical example and provide some policy implications.

Download or read book Three Essays on Income Redistribution written by Bo Hyun Chang and published by . This book was released on 2016 with total page 146 pages. Available in PDF, EPUB and Kindle. Book excerpt: "Income redistribution is one of the primary concerns for policy makers and economists. Among the countries in the Organization for Economic Co-operation and Development (OECD), the degree of income redistribution (measured by the percentage decrease in the income Gini coefficients between the before and after taxes/transfers) ranges from 5% (Chile) to 49% (Ireland). Understanding and comparing redistribution policies across countries in a unified framework is not an easy task. However, recent developments in quantitative general equilibrium heterogeneous-agents models allow us to address several issues. In this dissertation I study three issues about the redistribution polices using a state-of-the-art quantitative general equilibrium model. Chapter 1 uncovers Pareto weights that justify the current progressivity of income taxes in 32 OECD countries. Chapter 2 shows that the current tax rate in the U.S. can be close to political equilibrium under an ex-ante differences in earnings ability and income-dependent voting behaviors. Chapter 3 finds and explains the negative relationship between economic outlook and income redistribution. In Chapter 1, we develop a model that reproduces income distribution and redistribution policies in 32 OECD countries. The individual income tax schedule is assumed to follow a log-linear tax function, which is widely used in the literature (Heathcote et al., 2016). According to our model, the optimal tax progressivity under the equal-weight utilitarian social welfare function varies from 0.21 (South Korea) to 0.41 (Ireland), and the corresponding optimal redistribution ranges between 20% (South Korea) and 37% (Ireland). For 22 countries, mostly European countries, the current progressivity is higher than optimal. In the other 10 countries, including the U.S., the optimal progressivity is higher than the current one. In our model the optimal tax progressivity is favored by the majority of the population in almost all OECD countries. Then, why does the current (suboptimal) tax rate prevail? The society's choice for redistribution may differ from the equal-weight utilitarian welfare function (Weinzierl, 2014; Heathcote and Tsujiyama, 2016), or can be affected by various factors such as the externality of public expenditure (Heathcote et al., 2016), and the preference heterogeneity (Lockwood and Weinzierl, 2015). In this chapter we ask a rather simple positive question within the utilitarian framework: what are the weights in the social welfare function that justify the current tax progressivity as optimal? We interpret these relative weights in the social welfare function as broadly representing each society's preferences for redistribution and political arrangement. According to our calculations, in Sweden, the average Pareto weight on the richest 20% of the population is only 0.53, whereas that on the poorest 20% is 1.74. By contrast, in Chile, the Pareto weight on the richest 20% is 2.65, whereas that on the poorest 20% is a mere 0.15. In the U.S. that on the richest 20% is 1.45 and that on the poorest 20% is 0.60. We also compare our social weights to those from Lockwood and Weinzierl (2016), who extend Mirrleesian (1971) framework to uncover weights. To our knowledge, this is the first study that compares how societies aggregate individual preferences over redistributive policies, and does so across a large set of countries. The utilitarian social welfare function often predicts that the optimal income tax rate in the U.S. is much higher than the current rate (e.g., Piketty and Saez, 2013). In Chapter 2, we focus on the interaction of ex-ante heterogeneity in household earnings and income-dependent turnout rates. While the relationship between each factor and income redistribution has been reported by many studies (Benabou and Ok, 2001; Charite et al., 2015, Mahler, 2008), quantitatively neither effect alone is large enough to explain the current tax rate. However, the interaction of the two magnifies the effect on redistribution, political equilibrium can be close to the current tax rate. More specifically, we construct three model economies: no ex-ante heterogeneity (NH), small ex-ante heterogeneity (SH), and large ex-ante heterogeneity (LH). All three economies match the overall income dispersion (Gini coefficient) in the data, but the share of ex-ante productivity (ability) and ex-post productivity (shocks) is different. According to our estimates following Guvenen (2009), 31% (SH) and 57% (LH) of wage dispersions are driven by ex-ante productivity. In the NH, by design, all wage dispersions are from ex-post productivity. For tractability, a flat tax rate and a lump-sum transfer are assumed in this chapter. The current tax rates in the three economies are set to 24% from the U.S. data. According to our model, the optimal tax rates under an equal-weight utilitarian social welfare criterion are similar in all three economies: 37% (NH), 38% (SH) and 37%. These high optimal tax rates are consistent with a majority of literature based on a utilitarian social welfare function (e.g., Piketty and Saez, 2013; Heathcote and Tsujiyama, 2016). The tax rates chosen by a simple majority rule are 37% (NH), 37%(SH), and 34% (LH), still much higher than the current rate. However, once we introduce increasing voter turnout rates with income, as in the data (Mahler, 2008), the political equilibrium vastly differs across the three economies. The tax rates chosen by effective voting are 35% (NH), 33% (SH), and 27% (LH). In LH, where income dispersion is driven mainly by ex-ante productivity, the insurance benefit from a heavy tax-and-transfer policy diminishes, and high-ability households are more against strong redistribution. If their turnout rates are higher, a relatively low tax rate can become a political equilibrium, which is close to the current tax rate. In Chapter 3, I find a new relationship between the economic outlook and redistribution among 33 OECD countries between 1996 and 2010, using the historical forecasts in the World Economic Outlook and the Standardized World Income Inequality Database. A one percentage point decrease in expected growth is associated with a 0.005 point and 0.9% increase in the income Gini before taxes and transfers. To examine this relationship I introduce labor-augmenting technology into my model at the cost of assuming a simple tax structure (linear tax and lump-sum transfer). The current tax rate (21.8%) and labor-augmenting productivity growth (3%) are chosen to match the U.S. economy before the Great Recession. Then, after an unanticipated productivity slowdown, the productivity growth decreases to 1%. Once productivity slows down, households save more to prepare for lost consumption in the future. As the capital-to-output ratio increases, the interest rate goes down from 4% to 1.7%. As seen in previous chapters, explaining the current tax rate is still disputed. Leaving this question to other studies, this chapter focuses on the effect of a productivity slowdown. More specifically, social weights that justify the current tax rates are derived, and, given these weights, the optimal tax rate under the low-growth regime is calculated. While all households save more against productivity slowdown, poor households, who are close to borrowing constraints, have more difficulty in increasing their savings. Hence, higher tax rates (23.6%) and more transfers can enhance social welfare under the low-growth regime. This relationship between expected growth and redistribution is similar to my empirical estimates. A general equilibrium effect from increased capital plays an important role. If interest rates are fixed, private savings are more effective against a productivity slowdown, since households can continue to save at the same rate. In this economy the optimal tax rate under the low-growth regime is much lower than the current rate."--Pages v-viii.

Download or read book Essays in Fiscal and Monetary Policy written by Geeta Garg and published by . This book was released on 2021 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation consists of three essays concerning the macroeconomic effects of uncertainty about future path of fiscal and monetary policy.The first chapter provides a quantitative assessment of the impact of anticipated tax changes in Japan using a Vector Autoregressive (VAR) framework. For this paper, I utilize a new dataset that documents all the legislated federal and local government taxes in Japan which have been classified as exogenous based on the narrative evidence. The time period between the announcement and the implementation dates allows me to capture the anticipation effects of tax changes. The constructed series of (exogenous) tax shocks is incorporated directly in a VAR. I find that the anticipation effects of tax policy are important and have effects that are different from the unanticipated changes in tax policy. An unanticipated tax cut is expansionary and leads to an increase in output, investment and consumption. An anticipated tax cut however generates a slowdown in the quarters before its implementation and leads to a decline in all three variables. Once the anticipated tax cut is implemented, consumption recovers but investment and output continue to stay below their long-run trend. Lastly, I show that tax shocks are an important driver of certain business cycle episodes in Japan.The second paper studies the effects of fiscal uncertainty in Japan that arises due to the repeated failure of fiscal authorities in achieving the announced promises of fiscal consolidation in the future. In a New-Keynesian DSGE model with rational expectations, I examine the extent to which the uncertainty due to these repeated promises explain the slowdown experienced by the Japanese economy. I assume Markov-switching tax rules such that the response of taxes to debt vary with the fiscal stance of the government. I document that these promises generate time-variation in both the expected value and volatility of tax rates. Even in the regime in which taxes do not stabilize debt, the rising level of debt create expectations of higher future taxes causing economic contraction in the current period. These expectations lead to a decline in consumption, investment, labor hours, output and an increase in the level of debt which is also evident in the Japanese data since the 1990s.The third chapter examines the effects of uncertainty about the future path of monetary policy which is embedded in the news about who will be the future chairman of the Federal Reserve. To the extent the appointments of the Federal Reserve chairmen convey new information about future monetary policy, the financial markets respond to them as a result of revision in their expectations of the future path of interest rates or inflation. For this purpose, I construct a new dataset based on the daily counts of news articles that discuss these appointments. The underlying assumption is that the number of such news articles published on any day roughly measures the \ew information" about the direction of monetary policy. I find that the financial markets reacted adversely (Yen appreciated against USD, bond yields increased and stock returns slightly declined) in response to Volcker's departure or Greenspan's (first) appointment. However there was a muted response of financial markets to the appointments/departures that occurred afterwards.