Miao, Dingquan; Selin, Håkan; Söderström, Martin - 2022
We exploit a recent Swedish tax reform, implying higher marginal tax rates for the top 5% of the earnings distribution … sectional method, we estimate earnings elasticities in the range 0.13-0.16. We interpret the response using a simulation model … in which people face uncertain marginal tax rates due to earnings dynamics. The tax response is surprisingly sharp given …