Distributional and Fiscal Effects of the German Tax Reform 2000: A Behavioral Microsimulation Analysis
AbstractIn the year 2000, the German government passed the most ambitious tax reform in postwar German history aiming at a significant tax relief for households. Drawing on data of the GSOEP, we analyze the distributional and fiscal effects of the tax reform. Our analysis employs microsimulation techniques. Furthermore, we estimate behavioral effects of the tax reform using a discrete choice labor supply model. We find that the tax reform leads to a significant increase of net household income. The relative gains increase with taxable income, thus income inequality is rising. We also find that behavioral effects reduce the revenue loss.
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Bibliographic InfoPaper provided by DIW Berlin, German Institute for Economic Research in its series Discussion Papers of DIW Berlin with number 419.
Length: 28 p.
Date of creation: 2004
Date of revision:
Tax reform; Behavioral effects; Distribution and fiscal effects;
Find related papers by JEL classification:
- H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
- H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
- J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-05-02 (All new papers)
- NEP-CMP-2004-05-02 (Computational Economics)
- NEP-PUB-2004-05-02 (Public Finance)
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