EconPapers    
Economics at your fingertips  
 

The Effect of Anticipated Tax Changes on Intertemporal Labor Supply and the Realization of Taxable Income

W. Looney and Monica Singhal ()

Working Paper Series from Harvard University, John F. Kennedy School of Government

Abstract: We use anticipated changes in tax rates associated with changes in family composition to estimate intertemporal labor supply elasticities and elasticities of taxable income with respect to the net-of-tax wage rate. Changes in the ages of children can affect marginal tax rates through provisions of the tax code that are tied to child age and dependent status. We identify behavioral responses to these tax changes by comparing families who experienced a tax rate change to families who had a similar change in dependents but no resulting tax rate change. A primary advantage of our approach is that these changes can be anticipated, allowing us to estimate substitution effects that are not confounded by life-cycle income effects. We estimate an intertemporal elasticity of family labor earnings of 0.75 for families earning between $35,000 and $85,000 in the Survey of Income and Program Participation (SIPP) and find very similar estimates using the IRS-NBER individual tax panel.

JEL-codes: H2 (search for similar items in EconPapers)
Date: 2006-07
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9) Track citations by RSS feed

Downloads: (external link)
https://research.hks.harvard.edu/publications/work ... ?PubId=4051&type=WPN
Our link check indicates that this URL is bad, the error code is: 500 Server closed connection without sending any data back

Related works:
Working Paper: The Effect of Anticipated Tax Changes on Intertemporal Labor Supply and the Realization of Taxable Income (2006) Downloads
Working Paper: The effect of anticipated tax changes on intertemporal labor supply and the realization of taxable income (2005) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ecl:harjfk:rwp06-031

Access Statistics for this paper

More papers in Working Paper Series from Harvard University, John F. Kennedy School of Government Contact information at EDIRC.
Bibliographic data for series maintained by ().

 
Page updated 2020-08-08
Handle: RePEc:ecl:harjfk:rwp06-031