| 1. |
- Escobar, Sebastian, et al.
(författare)
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Giving to the children or the taxman? : Lessons from a Swedish inheritance tax loophole
- 2023
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Ingår i: European Economic Review. - : Elsevier. - 0014-2921 .- 1873-572X. ; 153
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Tidskriftsartikel (refereegranskat)abstract
- Wealth transfer tax systems based on inheritances and inter vivos gifts, rather than estates, allow donors to shift wealth among potential recipients with the goal of minimizing tax burdens. However, tax minimization often requires the donor to give up control over wealth if the transfers are made as inter vivos. Usually, such behavior is difficult to analyze as many potential heirs and many different tax schedules are involved. In this article, we study a simple setting that allows us to obtain transparent and credible evidence of inheritance tax responses. Swedish heirs could easily lower their inheritance tax bills to zero by giving part of the inheritance to their children. Using detailed administrative data, we show that many heirs tax minimized in a precise fashion. Still, among those inheriting just above the exemption, only about a half avoided the tax. Preferences for holding wealth and information seem to play major roles. Our findings have general policy relevance, because similar (but more complex) tax avoidance strategies can be used to avoid any inheritance tax.
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| 2. |
- Lindahl, Erica, et al.
(författare)
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Gender-targeted transfers by default? : Evidence from a child allowance reform in Sweden
- 2023
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Ingår i: Labour Economics. - : Elsevier. - 0927-5371 .- 1879-1034. ; 83
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Tidskriftsartikel (refereegranskat)abstract
- We exploit a sharp birthday discontinuity in a large and universal Swedish cash transfer program, creating plausibly exogenous variation in the default disbursement option, while holding entitlements and other financial incentives constant. When the cash transfer is paid out to the mother by default, instead of a 50/50 default, it has a large effect (55 percentage points) on the probability that the transfer is deposited in the mother's bank account also in the long run. Surprisingly, we find that the default policy redistributes resources to separated low-income mothers. We find no indications that the 100%-to-the-mother default induces mothers to work less or to take more responsibility for the children.
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| 3. |
- Edin, Per-Anders, et al.
(författare)
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Financial Risk-Taking and the Gender Wage Gap
- 2022
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Ingår i: Labour Economics. - : Elsevier. - 0927-5371 .- 1879-1034. ; 75
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Tidskriftsartikel (refereegranskat)abstract
- Could differences in risk attitudes explain parts of the gender wage gap? We present estimates on the association between labor market outcomes and financial risk-taking using individual level administrative data on individual wealth portfolios and wage rates from year 2000, when high-quality wealth data were available in Sweden. The individual's share of risky to total financial assets is significantly and positively associated with the wage rate. However, it turns out that our risk measure explains only a small part of the observed gender difference in wages.
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| 4. |
- Bastani, Spencer, Docent, 1982-, et al.
(författare)
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The Anatomy of the Extensive Margin Labor Supply Response
- 2021
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Ingår i: Scandinavian Journal of Economics. - : Wiley. - 0347-0520 .- 1467-9442. ; 123:1, s. 33-59
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Tidskriftsartikel (refereegranskat)abstract
- We estimate how labor force participation among married women in Sweden responded to changing work incentives implied by a reform in the tax and transfer system in 1997. Using rich, population‐wide, administrative data, we estimate an average participation elasticity of 0.13, thereby adding to the scarce literature estimating participation elasticities using quasi‐experimental methods. We also highlight that estimated extensive margin responses necessarily are local to the observed equilibrium. Among low‐income earners, elasticities are twice as large in the group with the lowest employment level, compared with the group with the highest employment level.
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| 5. |
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| 6. |
- Selin, Håkan, et al.
(författare)
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Income shifting as income creation?
- 2020
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Ingår i: Journal of Public Economics. - : ELSEVIER SCIENCE SA. - 0047-2727 .- 1879-2316. ; 182
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Tidskriftsartikel (refereegranskat)abstract
- Income shifting arises as one of the key questions when thinking about the design of a tax system as a whole. We study a simple economy, involving a benevolent policy-maker and a population of agents differing in terms of productivities, labor supply elasticities, and shifting costs. Paying special attention to the cost structure of income shifting, we highlight that when people who shift easily along the extensive margin are also more elastic in labor supply, giving them a lower tax rate is a good thing, and the government should not necessarily combat income shifting. This mechanism may be compared to third-degree price discrimination in industrial organization and works as a form of endogenous tagging. We explore this possibility numerically before showing that our results derived for a policy-maker optimally adjusting two linear tax instruments carry over when two fully non-linear taxes are potentially available.
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| 7. |
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| 8. |
- Lundberg, Jacob
(författare)
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Essays on Income Taxation and Wealth Inequality
- 2017
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Doktorsavhandling (övrigt vetenskapligt/konstnärligt)abstract
- This thesis is concerned with inequality, redistribution and taxation, in particular the taxation of labour income and the distribution of wealth. Most of the analysis is focused on Sweden. The thesis consists of four self-contained essays.Essay 1: “Analyzing tax reforms using the Swedish Labour Income Microsimulation Model”. Labour income taxation is a central policy topic because labour income makes up the majority of national income and most taxes are in the end taxes on labour. In order to quantify how behavioural responses of labour income earners affect tax revenue, the Swedish Labour Income Microsimulation Model (SLIMM) is constructed and used to evaluate tax reforms. Elasticities are calibrated to match midpoints of estimates found in the quasiexperimental literature. The simulations indicate that the earned income tax credit has increased employment by 128,000 and has a degree of self-financing of 21 percent. Almost half of the revenue increase from higher municipal tax rates would disappear due to behavioural responses. Tax cuts for the richest fifth of working Swedes are completely self-financing.Essay 2: “The Laffer curve for high incomes”. An expression for the Laffer curve for high incomes is derived, assuming a constant Pareto parameter and elasticity of taxable income. Microsimulations using Swedish population data show that the simulated curve matches the theoretically derived Laffer curve well, suggesting that the analytical expression is not too much of a simplification. A country-level dataset of top effective marginal tax rates and Pareto parameters is assembled. This is used to draw Laffer curves for 27 OECD countries. Revenue-maximizing tax rates and degrees of self-financing for a small tax cut are also computed. The results indicate that degrees of self-financing range between 28 and 195 percent. Five countries have higher tax rates than the peak of the Laffer curve.Essay 3: “Political preferences for redistribution in Sweden” (with Spencer Bastani). We examine preferences for redistribution inherent in Swedish tax policy 1971–2012 using the inverse optimal tax approach. The income distribution is carefully characterized with the help of administrative register data and we employ behavioral elasticities reflecting the perceived distortionary effects of taxation. The revealed social welfare weights are high for non-workers, small for low-income earners, and hump-shaped around the median. At the top, they are always negative, especially so during the high-tax years of the 1970s and ’80s. The weights on non-workers increased sharply in the 1970s, fell drastically in the late ’80s and early ’90s, and have since then increased.Essay 4: “Wealth inequality in Sweden: What can we learn from capitalized income data?” (with Daniel Waldenström). This paper presents new estimates of wealth inequality in Sweden during 2000–2012, linking wealth register data up to 2007 and individually capitalized wealth based on income and property tax registers for the period thereafter when a repeal of the wealth tax stopped the collection of individual wealth statistics. We find that wealth inequality increased after 2007 and that more unequal bank holdings and housing appear to be important drivers. We also evaluate the performance of the capitalization method by contrasting its estimates and their dispersion with observed stocks in register data up to 2007. The goodness-of-fit varies tremendously across assets and we conclude that although capitalized wealth estimates may well approximate overall inequality levels and trends, they are highly sensitive to assumptions and the quality of the underlying data sources.
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| 9. |
- Selin, Håkan
(författare)
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What happens to the husband's retirement decision when the wife's retirement incentives change?
- 2017
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Ingår i: International Tax and Public Finance. - : Springer Science and Business Media LLC. - 0927-5940 .- 1573-6970. ; 24:3, s. 432-458
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Tidskriftsartikel (refereegranskat)abstract
- In this paper, I exploit population-wide administrative data and a Swedish occupational pension reform, which primarily affected a subgroup of female workers, to recover the effect of the wife's retirement incentive on the husband's retirement behavior. I estimate a sharp relative decrease in the retirement probability of 63-year-old wives who were treated by the reform. However, there was no significant response of their husbands, and this finding is surprisingly robust. This suggests that cross-effects (from the wife to the husband) are substantially smaller than the direct effects of the wife's own incentive on the wife's retirement.
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| 10. |
- Bastani, Spencer, et al.
(författare)
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Estimating participation responses using transfer program reform
- 2016
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Rapport (övrigt vetenskapligt/konstnärligt)abstract
- In this paper we estimate labor force participation responses for married women in Sweden using population-wide register data and detailed information about individuals’ budget sets. For identification we exploit a reform in the system for housing allowances in 1997 which affected participation tax rates for households with/without children differently. Using a simple theoretical framework we provide a structural interpretation of our estimates and highlight how the employment response depends on the employment level. Our central estimate of the participation elasticity is 0.13. When splitting the treated sample into four quartiles based on the wife’s skill level we find that the participation elasticity is more than twice as large for the lowest-skill sample than for the highest-skill sample
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