Taxation

Advertising and consumer prices

Ferdinand Rauch, 13 November 2012

Advertising is expensive and thus raises the cost of goods, but it may encourage competition that keeps prices down. This column addresses the old question with data from a natural experiment brought about by tax harmonisation in Austria. It argues that on average advertising decreases consumer prices and estimates that if the 5% tax were abolished, consumer prices would decrease by about 0.25 percentage points.

Taxes and the workforce: Insights from the US

Casey B. Mulligan, 31 October 2012

What has happened to marginal tax rates in the US? This column argues that marginal tax rates vary so much among different groups in the US that redistributive taxes have actually damaged and interfered with the incentives and make up of the workforce.

Fiscal consolidation and reforms: Substitutes, not complements

Coen Teulings, 13 September 2012

Many OECD countries suffer from high sovereign debts. Sooner or later, this problem must be addressed. Many argue that this will require some form of fiscal retrenchment or institutional reform or a combination of the two. This column argues that the two are not complements as many suggest – they are instead substitutes.

Income taxation of US households: Facts and parametric estimates

Nezih Guner, Remzi Kaygusuz, Gustavo Ventura, 5 September 2012

Income tax is always a controversial issue in the US, particularly in election year. But how progressive is the US income tax system? This column looks at data on over 100,000 taxpayers from the Internal Revenue Service 2000 Public Use Tax File. It finds the question has more than one answer.

Income tax and labour supply: Let’s acknowledge what we don’t know

Charles F Manski, 23 August 2012

Does a high income tax rate cause people to work less, work more, or continue unaffected? This is a question that divides politicians and the public. And, according to this column, it is also a question that economists do not know the answer to. It is time to say so.

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