Found 8 article(s) for author 'Taxes'

The Effects of Fiscal Consolidations: Theory and Evidence

The Effects of Fiscal Consolidations: Theory and Evidence. Alberto Alesina, May 2017, Paper, “We investigate the macroeconomic effects of fiscal consolidations based upon government spending cuts, transfers cuts and tax hikes. We extend a narrative dataset of fiscal consolidations, finding details on over 3500 measures. Government spending and transfer cuts reduce output by less than tax hikes. Standard New Keynesian models match our results when fiscal shocks are persistent. Wealth effects on aggregate demand mitigates the impact of a persistent spending cut. Static distortions caused by persistent tax hikes cause larger shifts in aggregate supply under sticky prices. This channel explains different sizes of multipliers found in fiscal stimuli compared to consolidation plans.Link

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Anticipation, Tax Avoidance, and the Price Elasticity of Gasoline Demand

Anticipation, Tax Avoidance, and the Price Elasticity of Gasoline Demand. John Coglianese, James Stock, February 2017, Paper, “Traditional least squares estimates of the responsiveness of gasoline consumption to changes in gasoline prices are biased toward zero, given the endogeneity of gasoline prices. A seemingly natural solution to this problem is to instrument for gasoline prices using gasoline taxes, but this approach tends to yield implausibly large price elasticities. We demonstrate that anticipatory behavior provides an important explanation for this result. We provide evidence that gasoline buyers increase gasoline purchases before tax increases and delay gasoline purchases before tax decreases.Link

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Health and Taxes

Health and Taxes. David Cutler, October 25, 2016, Paper, “Viewing health care through the lens of a social issue prompts such questions as: What policies would best improve the population’s health? How can report cards be used to improve the quality of surgery? Where are there opportunities for additional disease prevention? The questions here are intricate and detailed. Some of the issues are clinical, and advice from physicians is actively sought and welcomed. For example, no one would develop a pay-for-performance system for surgeons without extensive involvement of the relevant surgical societies.Link

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Why Taxing Fairly Means Not Taxing Inheritances

Why Taxing Fairly Means Not Taxing Inheritances. N. Gregory Mankiw, September 9, 2016, Opinion, “Does it make sense to tax inheritances and, if so, how much? The answer to this question is a perennial political football. President George W. Bush, to whom I was an adviser, pushed for the elimination of the estate tax. He succeeded, but only briefly. In 2001, he signed legislation that phased out the tax and eliminated it in 2010. But the tax was back in 2011.Link

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Capital versus Output Subsidies: Implications of Alternative Incentives for Wind Energy

Capital versus Output Subsidies: Implications of Alternative Incentives for Wind Energy. Joseph Aldy, September 2016, Paper “We examine the choice between using capital and using output subsidies to promote wind energy in the United States. We exploit a natural experiment in which wind farm developers were unexpectedly given the opportunity to choose between an upfront investment subsidy and an output subsidy in order to estimate the differential impact of these subsidies on project productivity. Using matching and instrumental variables, we find that wind farms choosing the capital subsidy produce 5 to 12 percent less electricity per unit of capacity than wind farms selecting the output subsidy and that this effect is driven by incentives generated by these subsidies rather than selection. We then use these estimates to evaluate the public economics of U.S. wind energy subsidies. Link

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Oil’s Plunge Has Created Opening For Carbon Tax

Oil’s Plunge Has Created Opening For Carbon Tax. Lawrence Summers, January 6, 2015, Opinion. “The case for carbon taxes has long been compelling. With the recent steep fall in oil prices and associated declines in other energy prices, it has become overwhelming. There is room for debate about the size of the tax and about how the proceeds should be deployed. But there should be no doubt that, given the current zero tax rate on carbon, increased taxation would be desirable…” Link

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Gasoline Taxes and Consumer Behavior

Gasoline Taxes and Consumer Behavior, Erich Muehlegger, 2014, Paper, Gasoline taxes can be employed to correct externalities from automobile use and to raise government revenue. Our understanding of the optimal gasoline tax and the efficacy of existing taxes is largely based on empirical analysis of consumer responses to gasoline price changes. In this paper, we examine directly how gasoline taxes affect gasoline consumption as distinct from tax-inclusive retail gasoline prices. We find robust evidence that consumers respond more strongly to gasoline tax changes under a variety of model specifications. We discuss two potential reasons for our main findings as well as their implicationsLink

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