The Trump Administration’s Tax Plan is an Atrocity. Lawrence Summers, October 9, 2017, Opinion, “The Trump administration’s tax plan is not a plan. It is a melange of ideas put forth without precision or arithmetic. It is not clear enough to permit the kind of careful quantitative analysis of its expected budget costs, economic effects and distributional implications that precedes such legislation in a serious country.Link

Tags: , , , , ,

Tackling ‘the Thin File’ That Can Prevent a Promotion. Iris Bohnet, October 3, 2017, Opinion, “Recently, I have worked with a number of professional services firms committed to equality, diversity and inclusion. Many offer diversity training and leadership development programs, and many support affinity groups for traditionally underrepresented groups.  However, none has been able to crack what sometimes feels like a code set in stone: significantly increased diversity at the entry level, but very little change at the top.Link

Tags: , , , , , ,

Directions for International Tax Reform:, Hearing Before the U.S. Senate Committee on Finance, Hearing on International Tax Reform. Stephen Shay, October 3, 2017, Paper, “Testimony before the U.S. Senate Committee on Finance Hearing on International Tax Reform, October 3, 2017. Objectives for Tax Reform. Tax reform should maintain or enhance our tax system’s current level of progressivity in distributing tax burdens and benefits. The most significant social welfare fact today is that the income of middle and lower income workers has stagnated in recent decades and a disproportionate share of income growth has accrued to those with highest incomes—the top 1%. While we have recovered from the recession and middle and lower income workers have made some gains, the disparity between high-income and middle- and lower-income has grown substantially and income mobility is more constrained than for prior generations. The taxation of cross-border income of U.S. MNCs should be analyzed under the same fairness standards that apply to any other income.Link

Tags: , , , , , , , ,

The SEC Plans to Collect Too Much Information. Hal Scott, October 2, 2017, Opinion, “Is your personal information safe from the Securities and Exchange Commission? The SEC has mandated that U.S. stock exchanges and the Financial Industry Regulatory Authority establish a database by November 2018 that will store the names, birth dates, Social Security numbers and brokerage accounts of tens of millions of U.S. investors as part of the Consolidated Audit Trail.Link

Tags: , , , ,

Green Industrial Policy: Accelerating Structural Change towards Wealthy Green Economies. Dani Rodrik, 2017, Paper, “There are two major reasons for governments and societies to accelerate structural change in their economies and proactively shape its direction. First, there is the challenge of creating wealth. Structural change, that is, the reallocation of capital and labour from low- to high-productivity activities, is a key driver of productivity growth and higher incomes. This is particularly important for developing countries where incomes are low and poverty is pervasive. According to the latest available estimates, 767 million people lived on less than $1.90 a day, and 1.9 billion people in the developing world still had less than US $ 3.10 a day in 20131 – a clear indication that the current structural composition of national economies does not provide a sufficient number of productive jobs.Link

Tags: , , , , , ,

Urban transformations and the future of cities. Edward Glaeser, 2017, Book Chapter, “In the last few decades, many global cities and towns have experienced unprecedented economic, social, and spatial structural change. Today, we find ourselves at the juncture between entering a post-urban and a post-political world, both presenting new challenges to our metropolitan regions, municipalities, and cities. Many megacities, declining regions and towns are experiencing an increase in the number of complex problems regarding internal relationships, governance, and external connections. In particular, a growing disparity exists between citizens that are socially excluded within declining physical and economic realms and those situated in thriving geographic areas. This book conveys how forces of structural change shape the urban landscape.Link

Tags: , , ,

The Social Implications of Sugar: Living Costs, Real Incomes and Inequality in Jamaica c1774. Jeffery Williamson, October 2017, Paper, “This paper provides the first quantitative assessment of Jamaican standards of living and income inequality around 1774. To this purpose we compute welfare ratios for a range of occupations and build a social table. We find that the slave colony had extremely high living costs, which rose steeply during the American War of Independence, and low standards of living, particularly for its enslaved population. Our results also show that due to its extreme poverty surrounding extreme wealth Jamaica was the most unequal place in the pre-modern world. Furthermore, all of these characteristics applied to the free population alone.Link

Tags: , , , , , , ,

Expanding the Earned Income Tax Credit for Workers Without Dependent Children. Lawrence Katz, September 2017, Paper, “In recent decades, wage inequality in the United States has increased and real wages for less-skilled workers have declined. As a result, many American workers are unable to adequately support their families through work, even working full time. The Earned Income Tax Credit (EITC) has helped to counter this trend and has become one of the nation’s most effective antipoverty policies. But most of its benefits have gone to workers with children. The maximum credit available to workers without dependent children is just over $500, and workers lose eligibility entirely once their annual earnings reach $15,000.Link

Tags: , , , , , , , ,

The Productivity Slowdown and the Declining Labor Share: A Neoclassical Exploration. Elhanan Helpman, September 2017, Paper, “We explore the possibility that a global productivity slowdown is responsible for the widespread decline in the labor share of national income. In a neoclassical growth model with endogenous human capital accumulation a la Ben Porath (1967) and capital-skill complementarity a la Grossman et al. (2017), the steady-state labor share is positively correlated with the rates of capital-augmenting and labor-augmenting technological progress. We calibrate the key parameters describing the balanced growth path to U.S. data for the early postwar period and find that a one percentage point slowdown in the growth rate of per capita income can account for between one half and all of the observed decline in the U.S. labor share.Link

Tags: , , , ,

The Tax Reform Agenda. Martin Feldstein, September 26, 2017, Opinion, “The good news about our tax system is that, over the years, our tax rules have been getting better. Those who write the tax laws have been listening to the advice of economists — or at least what they have been doing for other reasons is in line with what economists have advised.  High tax rates that distort incentives and create large deadweight losses have been reduced: the top marginal rate of the personal income tax has come down from 92 percent to 40 percent now, and the corporate tax rate has come down from 50 percent to 35 percent. It has been possible to lower rates in that way by eliminating a variety of tax loopholes, i.e., tax accounting rules that allow taxable income to be less than economic income. So we have a less distorting — a more efficient — tax system than we did in the past.Link

Tags: , , ,