scholarly journals Tax Reform and Automatic Stabilization

2002 ◽  
Vol 92 (3) ◽  
pp. 411-433 ◽  
Author(s):  
Thomas J Kniesner ◽  
James P Ziliak
Keyword(s):  
Income Tax ◽  
Panel Study ◽  
Welfare Cost ◽  
Risk Averse ◽  
Income Dynamics ◽  
Income Risk ◽  
Tax Reforms ◽  
Automatic Stabilization ◽  
Consumption Insurance ◽  
Federal Income Tax

An income tax provides implicit insurance by dampening the variability of disposable income and consumption. Using an empirical framework derived from the consumption insurance literature and data from the Panel Study of Income Dynamics we examine the effect of federal income tax reforms of the 1980's on automatic stabilization of consumption. Overall, ERTA and TRA86 reduced consumption stability by about 50 percent. Recently increased EITC generosity restored or enhanced consumption insurance. The welfare cost of moving to the post-TRA86 system is sizable for relatively risk-averse households facing large income risk but is much more modest for the typical household.

scholarly journals The Effect of EITC Exposure in Childhood on Marriage and Early Childbearing

Demography ◽  
2021 ◽  
Author(s):  
Katherine Michelmore ◽  
Leonard M. Lopoo
Keyword(s):  
Income Tax ◽  
White Women ◽  
Panel Study ◽  
Early Adulthood ◽  
Well Being ◽  
Growing Up ◽  
Income Dynamics ◽  
Earned Income ◽  
Black And White ◽  
Using Data

Abstract Using data from the Panel Study of Income Dynamics, this study analyzes the effect of exposure to the Earned Income Tax Credit (EITC) in childhood on marriage and childbearing in early adulthood. Results suggest that EITC exposure in childhood leads women to delay marriage and first births in early adulthood (ages 16–25), but has no effect on men. A $1,000 increase in EITC exposure in childhood leads to a 2%–3% decline in a woman's likelihood of having a first birth and a comparable decline in her likelihood of marrying by her early 20s. We find similar reductions in fertility among Black and White women, though marriage declines are concentrated among White women. Results are focused on children growing up in the bottom half of the income distribution and those who spent the majority of childhood residing with a single parent—two groups that are the primary beneficiaries of the EITC. These findings have important implications for the well-being of individuals exposed to the EITC in childhood, as well as their future children.

scholarly journals Dynastic Precautionary Savings

2021 ◽  
Author(s):  
Corina Boar
Keyword(s):  
Panel Study ◽  
Precautionary Saving ◽  
Permanent Income ◽  
Precautionary Savings ◽  
Income Dynamics ◽  
Income Risk ◽  
Income Uncertainty ◽  
Parent Child

Abstract This article documents that parents accumulate savings to insure their children against income risk. I refer to this behaviour as dynastic precautionary saving. Using a sample of matched parent–child pairs from the Panel Study of Income Dynamics, I test for dynastic precautionary savings by examining the response of parental consumption to the child’s permanent income uncertainty. I exploit variation in permanent income risk across age and industry–occupation groups to confirm that, all else equal, higher uncertainty in the child’s permanent income depresses parental consumption, indicating a precautionary saving motive across generations.

scholarly journals The Economics of Workaholism: We Should Not Have Worked on This Paper

2008 ◽  
Vol 8 (1) ◽  
Author(s):  
Daniel S. Hamermesh ◽  
Joel B Slemrod
Keyword(s):  
Optimal Policy ◽  
Income Tax ◽  
Panel Study ◽  
Economic Life ◽  
Income Dynamics ◽  
Drinking Alcohol ◽  
Tax System ◽  
Highly Educated ◽  
Health Related ◽  
History Survey

Abstract A large literature examines the addictive properties of such behaviors as smoking, drinking alcohol, gambling and eating. We argue that for some people addictive behavior may apply to a much more central aspect of economic life: working. Although workaholism raises some of the same health-related concerns as other addictions, compared to most of the more familiar addictions it is more likely to be a problem of higher-income individuals and is more likely to generate negative spillovers onto individuals around the workaholic. Using the Retirement History Survey and the Panel Study of Income Dynamics, we show that high-income, highly educated people exhibit behavior that is consistent with workaholism with regard to retiring–they are more likely to postpone earlier plans for retirement. The theory and evidence suggest that the presence of workaholism calls for a more progressive income tax system than otherwise, although other more targeted policies may be part of optimal policy.

THE ECONOMIC EXISTENCE OF THE STATE IS IMPLEMENTED IN TAXES

2018 ◽  
pp. 356-358
Author(s):  
Oleg I. Mariskin
Keyword(s):  
Income Tax ◽  
Western Siberia ◽  
The State ◽  
Tax Reforms ◽  
Poll Tax

The review on the book: Kirillov A. K. From the Poll Tax to Income Tax: Tax Reforms of Capitalistic Russia and Their Implementation in Western Siberia in the second half of the XIX – early XX century. Novosibirsk, 2017, 178 p.

FEDERAL INCOME TAX

1922 ◽  
Vol 2 (4) ◽  
pp. 101-105
Author(s):  
H. L. Cunningham ◽  
Robt. J. Stute
Keyword(s):  
Income Tax ◽  
Federal Income Tax

Dynamic effects of consumption tax reforms with durable consumption

2020 ◽  
Vol 20 (2) ◽  
Author(s):  
Qian Li
Keyword(s):  
Generation Model ◽  
Consumption Tax ◽  
Income Risk ◽  
Tax Reforms ◽  
Market Completeness ◽  
Durable Consumption ◽  
Poor Households ◽  
Borrowing Constraint ◽  
The Difference ◽  
Consumption Taxes

AbstractThis paper introduces durables into a dynamic general equilibrium overlapping generation model with idiosyncratic income shocks and endogenous borrowing constraints, which depend on durables. The aim of this paper is to evaluate the welfare effects of consumption tax reforms in a richer model that captures the difference between nondurable and durable consumption. When durables are considered, the standard results that a shift to consumption taxes is welfare improving are overturned. The mechanism of this opposing result is that consumption tax makes durable consumption more expensive without relaxing the borrowing constraint. The inability of borrowing to insure against income risk deviates the economy further away from market completeness and particularly hurts young and poor households. As a result, welfare decreases, coupled with negative redistribution.

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