Tax and benefit systems generate aggregate intertemporal effects in addition to their interpersonal redistributive effects. These intertemporal effects appear in the cyclical fluctuations in the governmentÃs fiscal position yielded by the ëautomatic stabilisersÃ. Using EUROMOD, it is possible to produce estimates of the automatic stabilisers which focus on the stabilisation of household income rather than the budgetary effects of cyclical changes in taxes and benefits. These estimates are used to explore theoretical propositions about the role of the tax and benefit system in providing temporary income insurance to households, and to identify some of the possible effects of taxes and benefits on the speed of labour market adjustment over the cycle. The results show that the size of the stabilisers varies widely across the states participating in European Monetary Union (and the other EU-15 states). However, more analysis of the crosscutting effects of private insurance and access to credit is needed to determine the implications for stabilisation policy.
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
page. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
Publisher Info
Paper provided by EUROMOD at the Institute for Social and Economic Research in its series EUROMOD Working Papers with number
EM7/04.
Length: Date of creation: 01 Nov 2004 Date of revision: Handle: RePEc:ese:emodwp:em7/04
Note: Microsimulation, Automatic stabilisation, European Monetary Union, Insurance Unemployment Contact details of provider: Postal: RAB Butler Building, University of Essex, Wivenhoe Park, Colchester, ESSEX C04 3SQ Phone: +44 (0)1206 872957 Fax: +44 (0)1206 873151 Email: Web page: http://www.iser.essex.ac.uk/research/euromod/ More information through EDIRC
For technical questions regarding this item, or to correct its listing, contact: (Paul Groves).
Find related papers by JEL classification: C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Microeconomic Data D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household J68 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Public Policy
This paper has been announced in the following NEP Reports:
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.: