Polling data suggest that Americans are concerned about rising economic inequality, yet the same polls reveal popular opposition to redistributive tax policies that would help mitigate inequality. Numerous commentators have drawn attention to this paradox, attempting to explain why voters would...

Fiscal policy in the U.S. and other countries renders intertemporal budgets non-differentiable, nonconvex, and discontinuous. Consequently, assessing work and saving responses to policy requires global optimization. This paper develops the Global Life-Cycle Optimizer (GLO), a stochastic...

In this paper, we employ a unique tax experiment and dataset in a highly salient tax rate environment to examine consumer response to complex and uncertain tax reforms. Tax reforms raise some fundamental questions in public finance: How does consumption respond to tax change? How is the tax...

While a basic theoretical principle in public economics assumes that individuals’ behaviour is fully-optimizer with respect to the introduction of a tax, an increasing body of research is presenting evidence that agents decision making is often affected by non-negligible cognitive biases,...

Remote seller state sales and use tax collection and compliance is a significant and increasing economic issue for state and local jurisdictions, especially given the impact on interstate commerce and Congress' Commerce Clause authority to regulate in that area. In this article, author Thomas...

Every year many states offer sales tax holidays (STHs) temporarily exempting items like clothes, shoes and school supplies from the state sales tax. We use two data sets, the Diary portion of the Consumer Expenditure Survey and a unique data set of credit cards transactions, to investigate the...

Every year over 20 states offer sales tax holidays (STHs) on specific items like clothes, shoes and other items to encourage consumption, effecting over 100 million consumers. We use a unique dataset of credit cards transaction to study the spending response to these holidays. Using a...

This paper analyses a game theoretic model of tax competition in a system where tax authorities are revenue optimisers and countries are differentiated by size. The model accommodates more than two countries. In equilibrium, larger countries set higher tax rates non-cooperatively. By applying...

Using a representative survey of the German population, this paper studies individual consumption responses to a recent payroll tax reduction. Our results show that 55% of the respondents spend the extra money, indicating considerable potential for tax changes to affect consumption and economic...