Flexible Labor Supply Models Discrete-choice models of labor supply have become very popular for ex ante evaluations of policy reforms as they easily account for non-convex budget sets. We test the constraints imposed in practice on these models and suggest a fully flexible model that significantly improves fit. JEL Classification: H31, J22

Low liquidity and a high marginal propensity to consume are tightly linked. This paper analyzes this link in the context of income tax withholding refunds. A theory rational cash management with uncertainty endogenizes relationship between illiquidity consume, can explain finding that households tend spend refunds as if they valued liquidity, yet do not act increase by reducing their withholdin...

We ask whether attitudes toward government play a causal role in the evasion of US personal income taxes. As turnover elections move voters partisan counties into and out alignment with party president, we find (i) taxpayers report more easily evaded forms income; (ii) suspect EITC claims decrease; (iii) audits triggered found to owe additional tax decrease. Coupled evidence that leads favorabl...

We contribute to the literature on effect of taxes locational choices wealthy individuals by examining geographical sensitivity Forbes 400 richest Americans state estate taxes. Though we find billionaires’ effective tax rates are only about half statutory rate, their residential highly sensitive these taxes, as 35 percent local billionaires leave states with an tax. This tax-induced mobility ca...

Moonlighting is increasingly popular in OECD countries, with 5 to 10 percent of workers holding two or more jobs. However, little known about the responsiveness moonlighting financial incentives due lack identifying variation. This paper studies a unique reform Germany that allowed hold small secondary jobs tax-free, decreasing marginal tax rate by between 19.5 66 pp. I show resulted dramatic i...

This paper is concerned with a semiparametric Bayesian framework for estimating quantile treatment effects. A general and flexible model is specified using a generalization of the Pólya urn scheme. An exact Bayesian analysis is carried out by Markov chain Monte Carlo simulation methods. The proposed techniques are illustrated by estimating the effect of participation in the 401(k) retirement pr...

Social Security in Belgium: Distributive Outcomes The paper analyzes the link between old-age income programs and economic outcomes in Belgium. We use a simulation methodology to construct an average pension generosity variable. Our regression analysis explores the link with distributional outcomes in income, consumption and more subjective indicators. Results document the weak link between ave...

This paper deals with hyperbolic discounting in a macro context. Time consistency is discussed in terms of rational behavior and rational expectations. The theory is applied to the intertemporal consumption decision in order to explain undersaving in an economy. Moreover, possible implications on policy makers’ decisions on reforms and budget deficits are evinced. Finally, the Ricardian equival...

This paper uses data from the largest tax preparer in the United States to estimate the impact of the “saver’s credit,” a US federal program providing financial incentives to encourage retirement savings, on the decision to contribute to an IRA. It finds significant, but very modest, effects. This is contrasted with results from a field experiment showing much larger impacts of clearly presente...