Revealed social preferences of Dutch political parties

Jacobs, Bas; Jongen, Egbert; Zoutman, Floris

doi:10.1016/j.jpubeco.2017.08.002

Cited by 46 publications

(39 citation statements)

References 65 publications

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“…In the German income tax, progression is indeed particularly pronounced for middle incomes, a phenomenon referred to as the "Mittelstandsbauch" (middle class belly). This is similar in the Netherlands, see Jacobs et al (2017).…”

Section: Introductionsupporting

confidence: 69%

Politically Feasible Reforms of Nonlinear Tax Systems

Bierbrauer¹,

Boyer

Peichl

2021

American Economic Review

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We study reforms of nonlinear income tax systems from a political economy perspective. We present a median voter theorem for monotonic tax reforms, reforms so that the change in the tax burden is a monotonic function of income. We also provide an empirical analysis of tax reforms, with a focus on the United States. We show that past reforms have, by and large, been monotonic. We also show that support by the median voter was aligned with majority support in the population. Finally, we develop sufficient statistics that enable to test whether a given tax system admits a politically feasible reform. (JEL D72, H21, H24)

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Section: Introductionsupporting

confidence: 69%

Politically Feasible Reforms of Nonlinear Tax Systems

Bierbrauer¹,

Boyer

Peichl

2021

American Economic Review

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“…However, Jacquet, Lehmann and Van der Linden (2013) merge the Mirrlees model of optimal income taxation with labor supply on the intensive margin with Diamond (1980)'s model of optimal income taxation with labor supply on the extensive margin. Jacobs et al (2017) follow their analysis and demonstrate that in this model the marginal cost of public funds is once more equal to one in the tax optimum if the Diamond-based measure for the marginal costs of public funds is employed. Participation distortions are therefore not a reason why the marginal cost of public funds would rise above one in the tax optimum.…”

Section: Implications For Other Public Policiesmentioning

confidence: 87%

The marginal cost of public funds is one at the optimal tax system

Jacobs

2018

Int Tax Public Finance

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This paper develops a Mirrlees framework with skill and preference heterogeneity to analyze optimal linear and nonlinear redistributive taxes, optimal provision of public goods, and the marginal cost of public funds (MCF). It is shown that the MCF equals one at the optimal tax system, for both lump-sum and distortionary taxes, for linear and nonlinear taxes, and for both income and consumption taxes. By allowing for redistributional concerns, the marginal excess burden of distortionary taxes is shown to be equal to the marginal distributional gain at the optimal tax system. Consequently, the modified Samuelson rule should not be corrected for the marginal cost of public funds. Outside the optimum, the marginal cost of public funds for distortionary taxes can be either smaller or larger than one. The findings of this paper have potentially important implications for applied tax policy and social cost-benefit analysis. Keywords

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“…On the downside, a substantial fraction of low-income households do not take up the cash transfers designed for them. Furthermore, large kinks and notches imply large differences in the implicit social welfare weights for households that differ only slightly in their taxable income or wealth, which is inconsistent with a well-behaved social welfare function (Jacobs et al, 2017).…”

Section: Introductionmentioning

confidence: 94%

Non-bunching at kinks and notches in cash transfers in the Netherlands

Bösch

Jongen

Leenders

et al. 2019

Int Tax Public Finance

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We study the behavioural responses to kinks and notches in the Dutch system of cash transfers, using data on the universe of Dutch households for the period 2007-2014. We typically do not find statistically significant evidence of bunching around kinks or notches, neither in income nor in wealth. This finding is robust across different household types and modes of employment. We consider potential mechanisms that can explain this apparent lack of bunching.

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Revealed social preferences of Dutch political parties

Cited by 46 publications

References 65 publications

Politically Feasible Reforms of Nonlinear Tax Systems

Politically Feasible Reforms of Nonlinear Tax Systems

The marginal cost of public funds is one at the optimal tax system

Non-bunching at kinks and notches in cash transfers in the Netherlands

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