Optimal Taxation of Top Labor Incomes: a Tale of Three Elasticities†
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Kopczuk and Saez, 2004)
Top Wealth Shares in the United States, 1916–2000 Top Wealth Shares in the United States, 1916–2000: Evidence from Estate Tax Returns Abstract - This paper presents new homogeneous series on top wealth shares from 1916 to 2000 in the United States using estate tax return data. Top wealth shares were very high at the beginning of the period but have been hit sharply by the Great Depression, the New Deal, and World War II shocks. Those shocks have had per- manent effects. Following a decline in the 1970s, top wealth shares recovered in the early 1980s, but they are still much lower in 2000 than in the early decades of the century. Most of the changes we document are concentrated among the very top wealth holders with much smaller movements for groups below the top 0.1 percent. Con- sistent with the Survey of Consumer Finances results, top wealth shares estimated from Estate Tax Returns display no significant increase since 1995. Evidence from the Forbes 400 richest Ameri- cans suggests that only the super–rich have experienced significant gains relative to the average over the last decade. Our results are consistent with the decreased importance of capital incomes at the top of the income distribution documented by Piketty and Saez (2003), and suggest that the rentier class of the early century is not yet reconstituted. The paper proposes several tentative explanations to account for the facts. Wojciech Kopczuk INTRODUCTION Columbia University, New York, NY 10027 he pattern of wealth and income inequality during the and Tprocess of development of modern economies has at- tracted enormous attention since Kuznets (1955) formulated NBER, Cambridge, MA his famous inverted U–curve hypothesis. -
Tax Amnesty and Political Participation *
TAX AMNESTY AND POLITICAL PARTICIPATION * ABSTRACT In many countries thinking about a (new) tax amnesty is currently in vogue. However, cross-national ex- perience shows that the financial success of such a tax amnesty is not granted. Furthermore, it is debated whether in the long run tax amnesties undermine tax compliance. To measure the long run effects of an amnesty on compliance, experiments in different countries were conducted. In contrast to other experi- ments, we conduct an experiment in which the relationship between tax compliance and subjects’ possibil- ity to vote for or against an amnesty is analyzed. The results obtained from two experiments done in Costa Rica and Switzerland suggest that tax compliance only increases after voting, when people get the oppor- tunity to discuss prior to ballots. Thus, voting with discussion induces a kind of civic duty, as taxpayers become aware of the importance to contribute to the provision of public goods. JEL classification: H260, 9160 Keywords: tax amnesty, tax compliance, voting behavior, democracy * Benno Torgler, Georgia State University, Andrew Young School o f Policy Studies, Atlanta (USA), Center for Research in Economics, Management and the Arts (Switzerland), emails: [email protected] , [email protected]; Christoph A. Schaltegger, Swiss Federal Tax Administration, FTA, University o f St. Gallen, SIAW-HSG (Switzerland) and Center for Research in Economics, Management and the Arts (Switzerland), email: [email protected]. We wish to express our gratitude to Alberto Trejos (INCAE), Roderick MacGregor (INCAE) and Jesús Merino Serna (Universidad Fidélitas) who gave us the possibility to con- duct the laboratory experiment in Costa Rica and Markus Schaffner, who has done the experimental programming with z-Tree and has assisted the experiment. -
Esther Duflo Wins Clark Medal
Esther Duflo wins Clark medal http://web.mit.edu/newsoffice/2010/duflo-clark-0423.html?tmpl=compon... MIT’s influential poverty researcher heralded as best economist under age 40. Peter Dizikes, MIT News Office April 23, 2010 MIT economist Esther Duflo PhD ‘99, whose influential research has prompted new ways of fighting poverty around the globe, was named winner today of the John Bates Clark medal. Duflo is the second woman to receive the award, which ranks below only the Nobel Prize in prestige within the economics profession and is considered a reliable indicator of future Nobel consideration (about 40 percent of past recipients have won a Nobel). Duflo, a 37-year-old native of France, is the Abdul Esther Duflo, the Abdul Latif Jameel Professor of Poverty Alleviation Latif Jameel Professor of Poverty Alleviation and and Development Economics at MIT, was named the winner of the Development Economics at MIT and a director of 2010 John Bates Clark medal. MIT’s Abdul Latif Jameel Poverty Action Lab Photo - Photo: L. Barry Hetherington (J-PAL). Her work uses randomized field experiments to identify highly specific programs that can alleviate poverty, ranging from low-cost medical treatments to innovative education programs. Duflo, who officially found out about the medal via a phone call earlier today, says she regards the medal as “one for the team,” meaning the many researchers who have contributed to the renewal of development economics. “This is a great honor,” Duflo told MIT News. “Not only for me, but my colleagues and MIT. Development economics has changed radically over the last 10 years, and this is recognition of the work many people are doing.” The American Economic Association, which gives the Clark medal to the top economist under age 40, said Duflo had distinguished herself through “definitive contributions” in the field of development economics. -
Stefanie Stantcheva
Stefanie Stantcheva November 2017 Department of Economics Tel: 617-496-2614 Harvard University email: [email protected] Littauer Center 232 web: http://scholar.harvard.edu/stantcheva Cambridge, MA 02138 Employment Harvard University, Associate Professor of Economics 07/2017- Harvard University, Assistant Professor of Economics 07/2016-06/2017 Harvard Society of Fellows, Junior Fellow 07/2014-06/2016 Education Ph.D., Economics, Massachusetts Institute of Technology 2014 M.S., Economics, ENSAE and Paris School of Economics (Master APE) 2009 M.S., Economics and Finance, Ecole Polytechnique 2008 B.A., Economics, University of Cambridge 2007 Professional Activities Foreign Editor Review of Economic Studies 2017- Associate Editor Journal of Political Economy 2017- Faculty Research Fellow, National Bureau of Economic Research 2014 - Fellowships, Honors and Awards NSF CAREER Award 2017-2022 Furer Fellow, Harvard University 2017-2020 Excellence in Refereeing Award, American Economic Review 2016 Junior Fellow, Harvard Society of Fellows. 2014-2016 Review of Economic Studies Tour. 2014 Bradley Foundation Fellowship in Public Finance. 2010-2014 James Berkovec Memorial Fund Scholarship, MIT. 2009 Ida Green Institute Fellowship, MIT. 2009 Prize for the Best Master Dissertation, Chair of Business Economics, Ecole Polytechnique. 2008 Scholarship for Academic Excellence, Ecole Polytechnique. 2007-2008 Gladstone Memorial Prize for Best Undergraduate Dissertation, University of Cambridge 2007 Adam Smith Prize for Best Undergraduate Dissertation in Economics. 2007 Adam Smith Prize for Best Undergraduate Student in Economics. 2007 Scholar, Gonville and Caius College, University of Cambridge. 2004-2007 Bursary for Academic Excellence, Cambridge European Trust. 2004 1 Publications Stantcheva, Stefanie. 2014. “Optimal Income Taxation with Adverse Selection in the Labor Market.” Review of Economic Studies, 81, 1296-1329. -
World Economic Forum
Income inequality in the US: a version of the story you won't have ... https://www.weforum.org/agenda/2017/04/new-data-shows-what-h... Income inequality in the US: a version of the story you won't have heard Inequality trends since 2000 actually are different from those during the 1980s and 1990s. Image: REUTERS/Las Vegas This article is published in collaboration with the Washington Center for Equitable Growth 20 Apr 2017 Nick Bunker Policy Analyst, Washington Center for Equitable Growth How much has income inequality risen in the United States? Well, how do you define income? And what time period are you looking at? The most well-known statistics about income inequality—including the famous data from economists Thomas Piketty at the Paris School of Economics and Emmanuel Saez at the University of California, Berkeley—are based on tax data and show a significant increase in inequality since the late 1970s. But are the trends revealed in those data over that time period still holding up? 1 of 4 4/27/17, 1:49 PM Income inequality in the US: a version of the story you won't have ... https://www.weforum.org/agenda/2017/04/new-data-shows-what-h... Digging into the data reveals that inequality trends since 2000 actually are different from those during the 1980s and 1990s. A paper released last week as a National Bureau of Economics Research paper takes a look at how income inequality has changed in the 21st century. The two authors, Fatih Guvenen of the University of Minnesota and Greg Kaplan of the University of Chicago, take a look at two different sources of income data. -
Online Appendix for “Taxation and the International Mobility of Inventors”
Online Appendix for “Taxation and the International Mobility of Inventors” Ufuk Akcigit, University of Chicago and NBER Salomé Baslandze, EIEF Stefanie Stantcheva, Harvard and NBER May 2016 A Data Construction A.1 USPTO data We construct the benchmark micro-level dataset using the following data sources. The Disam- biguated Inventor Data is available from Harvard Dataverse Network1. Other details on patents come from the NBER patent data2. International data on top marginal income taxes comes from Piketty, Saez, and Stantcheva (2014).3 Raw data can be downloaded from the indicated sources or received from the authors. We provide online and on the Journal’s website a more comprehensive dataset at the inventor-year level with additional constructed variables, listed below, and clearly labeled. The forward citations for each patent are the truncation-adjusted citations, where truncation adjustment is defined in Hall, Jaffe, and Trajtenberg (2001). For each of the quality measures defined in SectionC, we define a reference distribution for each year and for each of the three regions (i) Europe and Canada, ii) United States, iii) Japan). We then rank inventors according to their percentile in that year. We take as our benchmark sample those inventors who have ever been in the top 25% in any year of their life in the data. Note however that the quality measure used to define top 1%, top 1-5%, etc. and used in levels in the regressions is a dynamic 1invpat.zip file from https://thedata.harvard.edu/dvn/dv/patent/faces/study/StudyPage.xhtml? globalId=hdl:1902.1/15705&studyListingIndex=1_cb493c4a38c48c6b3b3b31b31a44 2pat76_06_assg.dta and assignee.dta from https://sites.google.com/site/patentdataproject/Home/ downloads 3Available for download here: http://scholar.harvard.edu/stantcheva/publications/ optimal-taxation-top-incomes-tale-three-elasticities. -
Economic Report of the President.” ______
REFERENCES Chapter 1 American Civil Liberties Union. 2013. “The War on Marijuana in Black and White.” Accessed January 31, 2016. Aizer, Anna, Shari Eli, Joseph P. Ferrie, and Adriana Lleras-Muney. 2014. “The Long Term Impact of Cash Transfers to Poor Families.” NBER Working Paper 20103. Autor, David. 2010. “The Polarization of Job Opportunities in the U.S. Labor Market.” Center for American Progress, the Hamilton Project. Bakija, Jon, Adam Cole and Bradley T. Heim. 2010. “Jobs and Income Growth of Top Earners and the Causes of Changing Income Inequality: Evidence from U.S. Tax Return Data.” Department of Economics Working Paper 2010–24. Williams College. Boskin, Michael J. 1972. “Unions and Relative Real Wages.” The American Economic Review 62(3): 466-472. Bricker, Jesse, Lisa J. Dettling, Alice Henriques, Joanne W. Hsu, Kevin B. Moore, John Sabelhaus, Jeffrey Thompson, and Richard A. Windle. 2014. “Changes in U.S. Family Finances from 2010 to 2013: Evidence from the Survey of Consumer Finances.” Federal Reserve Bulletin, Vol. 100, No. 4. Brown, David W., Amanda E. Kowalski, and Ithai Z. Lurie. 2015. “Medicaid as an Investment in Children: What is the Long-term Impact on Tax Receipts?” National Bureau of Economic Research Working Paper No. 20835. Card, David, Thomas Lemieux, and W. Craig Riddell. 2004. “Unions and Wage Inequality.” Journal of Labor Research, 25(4): 519-559. 331 Carson, Ann. 2015. “Prisoners in 2014.” Bureau of Justice Statistics, Depart- ment of Justice. Chetty, Raj, Nathaniel Hendren, Patrick Kline, Emmanuel Saez, and Nich- olas Turner. 2014. “Is the United States Still a Land of Opportunity? Recent Trends in Intergenerational Mobility.” NBER Working Paper 19844. -
Stefanie Stantcheva
Stefanie Stantcheva May 2018 Department of Economics Tel : 617-496-2614 Harvard University email : [email protected] Littauer Center 232 web : http://scholar.harvard.edu/stantcheva Cambridge, MA 02138 Employment Harvard University, Professor of Economics 05/2018 - Harvard University, Associate Professor of Economics 07/2017- 04/2018 Harvard University, Assistant Professor of Economics 07/2016-06/2017 Harvard Society of Fellows, Junior Fellow 07/2014-06/2016 Education Ph.D., Economics, Massachusetts Institute of Technology 2014 M.S., Economics, ENSAE and Paris School of Economics (Master APE) 2009 M.S., Economics and Finance, Ecole Polytechnique 2008 B.A., Economics, University of Cambridge 2007 Professional Activities Member of the Economic Council of the French Prime Minister 06/2018 - Faculty Research Fellow, Center for Economic Policy Research 06/2018 - Foreign Editor Review of Economic Studies 10/2017- Associate Editor Journal of Political Economy 05/2017- Faculty Research Fellow, National Bureau of Economic Research 06/2014 - Fellowships, Honors and Awards 2018 Sloan Research Fellow 2018-2020 NSF CAREER Award 2017-2022 Furer Fellow, Harvard University 2017-2020 Excellence in Refereeing Award, American Economic Review 2016, 2017 Junior Fellow, Harvard Society of Fellows. 2014-2016 Review of Economic Studies Tour. 2014 Bradley Foundation Fellowship in Public Finance. 2010-2014 James Berkovec Memorial Fund Scholarship, MIT. 2009 Ida Green Institute Fellowship, MIT. 2009 1 Prize for the Best Master Dissertation, Chair of Business Economics, Ecole Polytechnique. 2008 Scholarship for Academic Excellence, Ecole Polytechnique. 2007-2008 Gladstone Memorial Prize for Best Undergraduate Dissertation, University of Cambridge 2007 Adam Smith Prize for Best Undergraduate Dissertation in Economics. -
What the Economic Report of the President Omits
Econ Journal Watch, Volume 3, Number 3, September 2006, pp 466-483. A Little More Liberty: What the JEL Omits in Its Account of What the Economic Report of the President Omits DANIEL B. KLEIN AND MICHAEL J. CLARK * A COMMENT ON: JOSEPH FARRELL, JONATHAN GRUBER, ROBERT E. HALL, GORDON H. HANSON, JOEL SLEMROD. 2005. REVIEWS OF THE 2005 ECONOMIC REPORT OF THE PRESIDENT. JOURNAL OF ECONOMIC LITERATURE. XLIII (SEPTEMBER): 801- 822. Abstract It is the highest impertinence and presumption, therefore, in kings and ministers, to pretend to watch over the œconomy of private people. Let them look well after their own expense, and they may safely trust private people with theirs. —Adam Smith (1776, 346) ADAM SMITH HELD THAT THE POLITICAL PROCESS—INVOLVING the mentalities of ordinary citizens, ministers, politicians, and intellectuals— is prone to an under-appreciation of the relative virtues of natural liberty and the social order that it generates. He attacked many economic policies by explaining how free individuals advance the interests of society. By describing how the independent actions of many individuals would generate * Department of Economics, George Mason University. Fairfax, VA 22030. For assistance with developing the survey of George Mason University professors, we thank Ted Balaker, Carl Close, Jerome Ellig, Adrian Moore, and Jane Shaw. For other suggestions we thank Erin Bartee. 466 ECONOMIC REPORT OF THE PRESIDENT beneficial order, and how government is riddled with knowledge and incentives problems, including vanity, conceit, and -
Subsidizing Health Insurance for Low-Income Adults: Evidence from Massachusetts: Dataset.” American Economic Review
American Economic Review 2019, 109(4): 1530–1567 https://doi.org/10.1257/aer.20171455 Subsidizing Health Insurance for Low-Income Adults: Evidence from Massachusetts† By Amy Finkelstein, Nathaniel Hendren, and Mark Shepard* How much are low-income individuals willing to pay for health insurance, and what are the implications for insurance markets? Using administrative data from Massachusetts’ subsidized insurance exchange, we exploit discontinuities in the subsidy schedule to esti- mate willingness to pay and costs of insurance among low-income adults. As subsidies decline, insurance take-up falls rapidly, drop- ping about 25 percent for each $40 increase in monthly enrollee pre- miums. Marginal enrollees tend to be lower-cost , indicating adverse selection into insurance. But across the entire distribution we can observe approximately the bottom 70 percent of the willingness to pay distribution( enrollees’ willingness to pay is always less than half of their own) expected costs that they impose on the insurer. As a result, we estimate that take-up will be highly incomplete even with generous subsidies. If enrollee premiums were 25 percent of insur- ers’ average costs, at most half of potential enrollees would buy insurance; even premiums subsidized to 10 percent of average costs would still leave at least 20 percent uninsured. We briefly consider potential explanations for these findings and their normative impli- cations. JEL G22, H51, H75, I13, I18 ( ) Governments spend an enormous amount of money on health insurance for low-income -
Reforming Taxation to Promote Growth and Equity
Reforming Taxation to Promote Growth and Equity White Paper by Joseph E. Stiglitz May 28, 2014 EXECUTIVE SUMMARY This white paper outlines concrete policy measures that can restore equitable and sustainable economic growth in the United States, in the context of the country’s recurring budgetary crises. Effective policies are within our grasp, because these budgetary crises are the result of political and not economic failings. Tax reform in particular offers a path toward both resolving budgetary impasses and making the kinds of public investments that will strengthen the fundamentals of the economy. The most obvious reform is an increase in the top marginal income tax rates – this would both raise needed revenues and soften America’s extreme and harmful inequality. But there are also a variety of other effective possible reforms related to corporate taxation, the estate and inheritance tax, environmental taxes, and ensuring that the government gets full value when it sells public assets. This white paper describes the gravity of the economic situation in the United States, but also shows that there is a way out. Joseph E. Stiglitz is a Senior Fellow and Chief KEY ARGUMENTS Economist at the Roosevelt Institute, • The current economic situation in the University Professor at Columbia University United States is grave, with extreme in New York, and chair of Columbia inequality, persistently high University's Commi!ee on Global Thought. unemployment, and GDP growth far He is also the co-founder and executive below potential, to name just a few director of the Initiative for Policy Dialogue at problems. But the barriers to a solution Columbia. -
Tax Policy and the Missing Middle: Optimal Tax Remittance with firm-Level Administrative Costs☆
Journal of Public Economics 95 (2011) 1036–1047 Contents lists available at ScienceDirect Journal of Public Economics journal homepage: www.elsevier.com/locate/jpube Tax policy and the missing middle: Optimal tax remittance with firm-level administrative costs☆ Dhammika Dharmapala a, Joel Slemrod b,⁎, John Douglas Wilson c a University of Illinois at Urbana-Champaign, 504 East Pennsylvania Avenue, Champaign, IL 61820, United States b University of Michigan, 701 Tappan Street, Ann Arbor, MI 48109-1234, United States c Michigan State University, Marshall-Adams Hall, East Lansing, MI 48824, United States article info abstract Article history: We analyze the optimal taxation of firms when the government faces fixed (per-firm) administrative costs of Received 30 June 2009 tax collection. The tax instruments at the government's disposal are a fixed (per-firm) fee and a linear tax on Received in revised form 12 October 2010 output. If all firms in an industry are taxed, we show that it is optimal to impose a positive fee to internalize Accepted 20 October 2010 administrative costs. The output taxes satisfy the inverse elasticity rule for taxed industries, but industries Available online 3 December 2010 with sufficiently high administrative costs should be exempted from taxation. We also investigate the case where firms with outputs below a cutoff level can be exempted from taxation. It may be optimal to set the Keywords: fi fi Taxation cutoff high enough to exempt a sizable number of rms, even though some rms reduce their outputs to the Optimal taxation cutoff level, creating a “missing middle”: small and large firms – but not those of intermediate size – exist.