TAX TRANSFORMATIONS EFFECTS

The State-Dependent Effects of Tax Shocks∗

This paper studies the state-dependent effects of shocks to distortionary tax rates in a dynamic stochastic general equilibrium (DSGE) model augmented with a number of real and nominal frictions. The tax output multiplier is defined as the change in output for a one dollar change in tax revenue caused by a shock to distortionary tax rates on consumption, labor income, or capital income. We find...

Identifying Tax Effects on Charitable Giving

This paper estimates the effects of three federal tax acts—the Economic Growth and Tax Relief Reconciliation Act of 2001 (H.R. 1836), the Jobs and Growth Tax Relief Reconciliation Act of 2003 (H.R. 2), and the Working Families Tax Relief Act of 2004 (H.R. 1308)—on charitable giving, and offers four extensions relative to previous work. First, we use new data—the Center on Philanthropy Panel Stu...

Bush Administration Tax Policy: Distributional Effects

Tax Effects on the Real Exchange Rate

This study examines the effects of taxes on the real exchange rate through their marginal impacts on economic activity. We develop a model that shows that an increase in the capital interest tax rate leads to real domestic currency depreciation while an increase in wage or consumption tax rates lead to a real domestic currency appreciation. These theoretical findings are supported by an empiric...

The Distributional Effects of Environmental Tax Reform

In recent years there has been increased debate about the potential for shifting the incidence of the tax system away from a variety of economic ‘goods’ (i.e. employment, investment, etc ...) and towards environmental ‘bads’ (i.e. pollution emissions, resource extraction, etc ...). However, in spite of their apparent efficiency, economic instruments have been adopted relatively less frequently ...