IDEAS home Printed from https://ideas.repec.org/p/nbr/nberwo/0988.html
   My bibliography  Save this paper

Identification in Tax-Price Regression Models: The Case of Charitable Giving

Author

Listed:
  • Daniel R. Feenberg

Abstract

In this paper we use an instrumental variable estimator to exploit sources of independent variation, which allows unbiased estimation of the tax-price elasticity under more general conditions. The estimator is applied to the demand for charitable giving. A charitable giving equation is an appropriate test for this procedure because it represents the purest case of a tax-price coefficient. That is, taxes are the sole source of variance in the price. The deduction is also an important policy issue. In 1982, 1.8 percent of gross income was deducted for this reason, about as much as the capital gains deduction.

Suggested Citation

  • Daniel R. Feenberg, 1982. "Identification in Tax-Price Regression Models: The Case of Charitable Giving," NBER Working Papers 0988, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:0988
    Note: PE
    as

    Download full text from publisher

    File URL: http://www.nber.org/papers/w0988.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. S. Rosen, Harvey, 1987. "Studies in state and local public finance," Business Horizons, Elsevier, vol. 30(3), pages 84-85.
    2. King, Mervyn A., 1980. "An econometric model of tenure choice and demand for housing as a joint decision," Journal of Public Economics, Elsevier, vol. 14(2), pages 137-159, October.
    3. Rosen, Harvey S, 1976. "Tax Illusion and the Labor Supply of Married Women," The Review of Economics and Statistics, MIT Press, vol. 58(2), pages 167-172, May.
    4. Clotfelter, Charles T, 1980. "Tax Incentives and Charitable Giving: Evidence from a Panel of Taxpayers," Empirical Economics, Springer, vol. 13(3), pages 319-340, June.
    5. Rosen, Harvey S. (ed.), 1986. "Studies in State and Local Public Finance," National Bureau of Economic Research Books, University of Chicago Press, number 9780226726212, December.
    6. Clotfelter, Charles T., 1980. "Tax incentives and charitable giving: evidence from a panel of taxpayers," Journal of Public Economics, Elsevier, vol. 13(3), pages 319-340, June.
    7. Martin Feldstein, 1983. "Behavioral Simulation Methods in Tax Policy Analysis," NBER Books, National Bureau of Economic Research, Inc, number feld83-2, March.
    8. Feldstein, Martin S & Taylor, Amy, 1976. "The Income Tax and Charitable Contributions," Econometrica, Econometric Society, vol. 44(6), pages 1201-1222, November.
    9. Clotfelter, Charles T., 1985. "Federal Tax Policy and Charitable Giving," National Bureau of Economic Research Books, University of Chicago Press, edition 1, number 9780226110486, December.
    10. Daniel R. Feenberg & Harvey S. Rosen, 1986. "State Personal Income and Sales Taxes, 1977–1983," NBER Chapters, in: Studies in State and Local Public Finance, pages 135-186, National Bureau of Economic Research, Inc.
    11. Charles T. Clotfelter, 1985. "Federal Tax Policy and Charitable Giving," NBER Books, National Bureau of Economic Research, Inc, number clot85-1, March.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Poterba, James M, 1987. "Tax Evasion and Capital Gains Taxation," American Economic Review, American Economic Association, vol. 77(2), pages 234-239, May.
    2. Lawrence B. Lindsey, 1985. "The Effect of the Treasury Proposal on Charitable Giving: A Comparison of Constant and Variable Elasticity Models," NBER Working Papers 1592, National Bureau of Economic Research, Inc.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Timm Bönke & Nima Massarrat-Mashhadi & Christian Sielaff, 2013. "Charitable giving in the German welfare state: fiscal incentives and crowding out," Public Choice, Springer, vol. 154(1), pages 39-58, January.
    2. O'Neil, Cherie J. & Steinberg, Richard S. & Thompson, G. Rodney, 1996. "Reassessing the Tax-Favored Status of the Charitable Deduction for Gifts of Appreciated Assets," National Tax Journal, National Tax Association, vol. 49(2), pages 215-33, June.
    3. Peter G. Backus & Nicky L. Grant, 2019. "How sensitive is the average taxpayer to changes in the tax-price of giving?," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 26(2), pages 317-356, April.
    4. O'Neil, Cherie J. & Steinberg, Richard S. & Thompson, G. Rodney, 1996. "Reassessing the Tax-Favored Status of the Charitable Deduction for Gifts of Appreciated Assets," National Tax Journal, National Tax Association;National Tax Journal, vol. 49(2), pages 215-233, June.
    5. Grubert, Harry & Newlon, T. Scott, 1996. "Reply to Avi-Yonah," National Tax Journal, National Tax Association, vol. 49(2), pages 267, June.
    6. Grubert, Harry & Newlon, T. Scott, 1996. "Reply to Avi-Yonah," National Tax Journal, National Tax Association;National Tax Journal, vol. 49(2), pages 267-267, June.
    7. Barrett, Kevin S. & McGuirk, Anya M. & Steinberg, Richard S., 1997. "Further Evidence on the Dynamic Impact of Taxes on Charitable Giving," National Tax Journal, National Tax Association;National Tax Journal, vol. 50(2), pages 321-334, June.
    8. Russell N. James & Deanna L. Sharpe, 2007. "The “Sect Effect” in Charitable Giving: Distinctive Realities of Exclusively Religious Charitable Givers," American Journal of Economics and Sociology, Wiley Blackwell, vol. 66(4), pages 697-726, October.
    9. Julio Videras, 2005. "Luck and giving," Applied Economics Letters, Taylor & Francis Journals, vol. 12(15), pages 953-956.
    10. Barrett, Kevin S. & McGuirk, Anya M. & Steinberg, Richard S., 1997. "Further Evidence on the Dynamic Impact of Taxes on Charitable Giving," National Tax Journal, National Tax Association, vol. 50(2), pages 321-34, June.
    11. Smith, Vincent H. & Kehoe, Michael R. & Cremer, Mary E., 1995. "The private provision of public goods: Altruism and voluntary giving," Journal of Public Economics, Elsevier, vol. 58(1), pages 107-126, September.
    12. Borgloh, Sarah, 2008. "What Drives Giving in Extensive Welfare States? The Case of Germany," ZEW Discussion Papers 08-123, ZEW - Leibniz Centre for European Economic Research.
    13. Adena, Maja, 2021. "Tax-price elasticity of charitable donations – evidence from the German taxpayer panel," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, pages 219-235.
    14. Asatryan, Zareh & Joulfaian, David, 2022. "Taxes and Business Philanthropy in Armenia," Journal of Economic Behavior & Organization, Elsevier, vol. 200(C), pages 914-930.
    15. David Roodman & Scott Standley, 2006. "Tax policies to promote private charitable giving in DAC countries," Working Papers 82, Center for Global Development.
    16. Jonathan Meer & Benjamin A. Priday, 2020. "Tax Prices and Charitable Giving: Projected Changes in Donations under the 2017 Tax Cuts and Jobs Act," Tax Policy and the Economy, University of Chicago Press, vol. 34(1), pages 113-138.
    17. Martin S. Feldstein & Lawrence Lindsey, 1983. "Simulating Nonlinear Tax Rules and Nonstandard Behavior: An Application to the Tax Treatment of Charitable Contributions," NBER Chapters, in: Behavioral Simulation Methods in Tax Policy Analysis, pages 139-172, National Bureau of Economic Research, Inc.
    18. Priller, Eckhard & Sommerfeld, Jana, 2005. "Wer spendet in Deutschland? Eine sozialstrukturelle Analyse," Discussion Papers, Research Unit: Inequality and Social Integration SP I 2005-202, WZB Berlin Social Science Center.
    19. Karen Smith Conway, 1994. "Reconsidering the Effects of Fiscal Policy On Private Sector Behavior: a Unifying View of Neutrality," Public Finance Review, , vol. 22(2), pages 195-221, April.
    20. Joel Slemrod, 2002. "Trust in Public Finance," NBER Working Papers 9187, National Bureau of Economic Research, Inc.

    More about this item

    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:nbr:nberwo:0988. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/nberrus.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.