Intergenerational Income Mobility and Income Taxation

Arbeitspapier

We study the impact of income taxation on intergenerational income correlation. We estimate a life cycle dynastic model and conduct counterfactual analysis to observe the effects of various tax regimes. Compared to a no tax environment, a flat tax regime reduces the correlation only by one percentage points. If the flat tax regime provides child benefits, the correlation additionally declines by four percentage points. Finally, if the taxes are progressive, the reduction, which is due to the increase in the fertility rate (quantity) and the decrease in the educational outcome of children (quality), is highly significant (seven percentage points).

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: GLO Discussion Paper ; No. 409

Classification and Topics

• Classification: Wirtschaft ; Estimation: General ; Fertility; Family Planning; Child Care; Children; Youth ; Time Allocation and Labor Supply ; Job, Occupational, and Intergenerational Mobility; Promotion
• Subject: Dynastic Models ; Discrete Choice ; Fertility ; Income Taxation

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Kurnaz, Musab ; Soytas, Mehmet A.
• Event: Veröffentlichung
• (who): Global Labor Organization (GLO)
• (where): Essen
• (when): 2019

Further information

• Handle: http://hdl.handle.net/10419/204482
• Last update: 10.03.2025, 11:43 AM CET