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A Note on Automatic Stabilizers in Austria: Evidence from ITABENA

Helmut Hofer, Tibor Hanappi () and Sandra Müllbacher ()
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Sandra Müllbacher: Institut für Höhere Studien (IHS) / Department of Economics & Finance

Authors registered in the RePEc Author Service: Joseph Francois

No 2012-03, NRN working papers from The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria

Abstract: In the Great Recession market income of the households in Austria has been reduced and unemployment increased. In this paper we examine the impact of automatic stabilizers on cushioning such income losses. We use ITABENA, an Austrian tax-benefit model, to analyze how shocks on market income and employment are mitigated by taxes and transfers. In the case of a proportional income shock 46 percent of the shock will be absorbed by automatic stabilizers in Austria. For the unemployment shocks automatic stabilizers absorb 68 percent. Automatic stabilizers increase the redistributive effects of the Austrian tax benefit system. We find that recent changes in the income tax code have almost no impact on the size of automatic stabilizers in Austria.

Keywords: automatic stabilization; microsimulation; tax reforms (search for similar items in EconPapers)
JEL-codes: E32 E63 H2 H31 (search for similar items in EconPapers)
Pages: 15 pages
Date: 2012-03
New Economics Papers: this item is included in nep-acc, nep-cmp and nep-mac
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Persistent link: https://EconPapers.repec.org/RePEc:jku:nrnwps:2012_03

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