IDEAS home Printed from https://ideas.repec.org/a/gmf/journl/y2020i51p2138.html
   My bibliography  Save this article

The Impact of Labor Income Tax Progressivity on the Fiscal Multipliers in the Context of the Fiscal Consolidation

Author

Listed:
  • Mariana Santos

    (Nova School of Business and Economics)

Abstract

’Fiscal multipliers depend on several structural characteristics of each economy. In this study it is argued that labor income tax progressivity lowers the fiscal multipliers of fiscal consolidation programs. By calibrating an incomplete-markets, overlapping generations model for the United States for different values of the labor income tax progressivity, it is shown that as progressivity increases the recessionary impacts of fiscal consolidation are lower in the case of consolidation through decrease of government spending and are more recessionary in the case of consolidation financed with tax hikes.’

Suggested Citation

  • Mariana Santos, 2020. "The Impact of Labor Income Tax Progressivity on the Fiscal Multipliers in the Context of the Fiscal Consolidation," Notas Económicas, Faculty of Economics, University of Coimbra, issue 51, pages 21-38, December.
    • Handle: RePEc:gmf:journl:y:2020:i:51:p:21:38
    DOI: 10.14195/2183-203X_51_2
    as

    Download full text from publisher

    File URL: https://impactum-journals.uc.pt/notaseconomicas/article/view/9213/6930
    Download Restriction: no
    File URL: https://libkey.io/10.14195/2183-203X_51_2?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Keywords

    Fiscal multipliers; labor income tax progressivity; government spending; taxation.;
    All these keywords.

    JEL classification:

    • D52 - Microeconomics - - General Equilibrium and Disequilibrium - - - Incomplete Markets
    • H6 - Public Economics - - National Budget, Deficit, and Debt
    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gmf:journl:y:2020:i:51:p:21:38. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sofia Antunes (email available below). General contact details of provider: https://edirc.repec.org/data/fecucpt.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.