This paper provides new empirical insights on the elasticity of taxable income to the net-oftax rate. Using a panel of German income tax return data, we followed taxpayers from 2001 to 2006 to analyze the effects of the German tax reforms of 2004 and 2005. Implementing a dynamic model as...

This paper provides new empirical insights on the elasticity of taxable income for Germany. Using a rich panel of German income tax return data, the tax reforms of 2004 and 2005 are exploited implementing a new dynamic income model. Showing and discussing potential estimation problems of the...

We study reforms of non-linear 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...

Are reforms towards individual taxation politically feasible? Are they desirable from a welfare perspective? We develop a method to answer such questions and apply it to the US federal income tax since the 1960s. Main findings are: As of today, Pareto-improvements require a move away from joint...

This article describes ZEW-EviSTA®, the microsimulation model developed and used at ZEW - Centre for European Economic Research in Mannheim. The model simulates the German tax and transfer system using household micro level data. By estimating fiscal effects, labor market outcomes as well as...

The employment effects of an ecological tax reform depend decisively on the presence of a profit tax and on the extent to which profits are taxed. This is shown in a model where firms have monopoly power on product markets and bargain over wages with unions on the labour market. In the setting,...

We use a New Keynesian DSGE model with search frictions on the housing market to evaluate how financing a labor tax reduction by higher property taxation affects the real economy and welfare. Search on the housing market enables us to explicitly model stocks and flows, which is necessary to...