Arbeitspapier

Are income and consumption taxes ever really equivalent?: evidence from a real-effort experiment with real goods

The public finance literature demonstrates the equivalence between consumption and labor income (wage) taxes. We construct an environment in which individuals make real labor-leisure choices and spend their earned income on real goods. We use this experimental framework to test whether a labor income tax and an equivalent consumption tax lead to an identical labor-leisure allocation. Despite controlling for subjects' work ability and inherent labor-leisure preferences and not allowing for saving, subjects reduce their labor supply significantly more in response to an income tax than they do in response to an equivalent consumption tax. We discuss the economic implications of a policy shift from an income to a consumption tax.

Sprache
Englisch

Erschienen in
Series: CESifo Working Paper ; No. 2194

Klassifikation
Wirtschaft
Design of Experiments: Laboratory, Individual
Taxation and Subsidies: Incidence
Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes
Fiscal Policies and Behavior of Economic Agents: Household
Thema
experimental economics
tax equivalence
income tax
consumption tax
behavioral economics
Einkommensteuer
Verbrauchsteuer
Steuerinzidenz
Privater Haushalt
Test
Verhaltensökonomik

Ereignis
Geistige Schöpfung
(wer)
Blumkin, Tomer
Ruffle, Bradley J.
Ganun, Yosef
Ereignis
Veröffentlichung
(wer)
Center for Economic Studies and ifo Institute (CESifo)
(wo)
Munich
(wann)
2008

Handle
Letzte Aktualisierung
10.03.2025, 11:42 MEZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Blumkin, Tomer
  • Ruffle, Bradley J.
  • Ganun, Yosef
  • Center for Economic Studies and ifo Institute (CESifo)

Entstanden

  • 2008

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