Advanced Search

Papers Articles Authors Institutions Data (FRED®)

Abstract

We analyse the distributional impact of lowering social security contributions and compensating the revenue loss by an increase in indirect taxes. We empirically assess the distributional consequences of this shift by using two Belgian microsimulation models: modété for the tax benefit system, and aster for the indirect tax part. Since the underlying micro database of the tax benefit system does not contain expenditures, we first impute detailed expenditures in the income data survey, by means of semiparametric Engelcurves. The currently living generation of pensioners belongs to the losers by such a reform: They do not profit from the reduced tax on labour income, but pay higher consumption prices. Less obvious, also part of the working population loses. Even not all those who leave unemployment after the reform are gainers. We also investigate the sensitivity of the results w.r.t. the choice of welfare measure to assess the combined change in disposable income, consumer prices and - in the case of exible labour supply - leisure. We show how the specific choice and parameters of the welfare measure will influence the conclusions, possibly even more than the predictive model for assessing the behavioural reactions in labour supply.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. 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.

File URL: https://lirias.kuleuven.be/bitstream/123456789/196761/1/DPS0812.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Katholieke Universiteit Leuven in its series Open Access publications from Katholieke Universiteit Leuven with number urn:hdl:123456789/196761.

as HTML HTML with abstract plain text plain text with abstract BibTeX RIS (EndNote, RefMan, ProCite) ReDIF in new window

Length:
Date of creation: 2008
Date of revision:
Handle: RePEc:ner:leuven:urn:hdl:123456789/196761

Contact details of provider:
Web page: http://www.kuleuven.be

Related research

Keywords:

Other versions of this item:

Find related papers by JEL classification:

• D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
• H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
• H55 - Public Economics - - National Government Expenditures and Related Policies - - - Social Security and Public Pensions
• J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

References

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.:

as HTML HTML with abstract plain text plain text with abstract BibTeX RIS (EndNote, RefMan, ProCite) ReDIF in new window

1. Buscher, Herbert S. & Buslei, Hermann & Goggelmann, Klaus & Koschel, Henrike & Schmidt, Tobias F. N. & Steiner, Viktor & Winker, Peter, 2001. "Empirical macro models under test. A comparative simulation study of the employment effects of a revenue neutral cut in social security contributions," Economic Modelling, Elsevier, vol. 18(3), pages 455-474, August.
   
   • Buscher, Herbert S. & Buslei, Hermann & Göggelmann, Klaus & Koschel, Henrike & Ramb, Fred & Schmidt, Tobias F. N. & Steiner, Viktor & Winker, Peter, 1998. "Empirical macromodels under test: a comparative simulation study of the employment effects of a revenue neutral cut in social security contributions," ZEW Discussion Papers 98-40, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
2. Richard Blundell & Alan Duncan & Julian McCrae & Costas Meghir, 2000. "The labour market impact of the working families’ tax credit," Fiscal Studies, Institute for Fiscal Studies, vol. 21(1), pages 75-103, March.
3. Ian Walker & Ian Preston, 1999. "Welfare measurement in labour supply models with nonlinear budget constraints," Journal of Population Economics, Springer, vol. 12(3), pages 343-361.
4. Dagsvik, John K, 1994. "Discrete and Continuous Choice, Max-Stable Processes, and Independence from Irrelevant Attributes," Econometrica, Econometric Society, vol. 62(5), pages 1179-1205, September.
5. repec:bla:restud:v:72:y:2005:i:1:p:57-76 is not listed on IDEAS
6. John Creedy & Guyonne Kalb, 2003. "Discrete Hours Labour Supply Modelling: Specification, Estimation and Simulation," Treasury Working Paper Series 03/20, New Zealand Treasury.
   
   • John Creedy & Guyonne Kalb, 2005. "Discrete Hours Labour Supply Modelling: Specification, Estimation and Simulation," Journal of Economic Surveys, Wiley Blackwell, vol. 19(5), pages 697-734, December.
   • John Creedy & Guyonne Kalb & Rosanna Scutella, 2003. "Discrete Hours Labour Supply Modelling: Specification, Estimation and Simulation," Melbourne Institute Working Paper Series wp2003n21, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
   • John Creedy & Guyonne Kalb, 2003. "Discrete Hours Labour Supply Modelling: Specification, Estimation and Simulation," Melbourne Institute Working Paper Series wp2003n16, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
7. Bohringer, Christoph & Boeters, Stefan & Feil, Michael, 2005. "Taxation and unemployment: an applied general equilibrium approach," Economic Modelling, Elsevier, vol. 22(1), pages 81-108, January.
   
   • Christoph Boehringer & Stefan Boeters & Michael Feil, 2004. "Taxation and Unemployment: An Applied General Equilibrium Approach," CESifo Working Paper Series 1272, CESifo Group Munich.
8. Creedy, John & Duncan, Alan, 2002. " Behavioural Microsimulation with Labour Supply Responses," Journal of Economic Surveys, Wiley Blackwell, vol. 16(1), pages 1-39, February.
9. Kristian Orsini, 2006. "Is Belgium 'making work pay'?," Center for Economic Studies - Discussion papers ces0605, Katholieke Universiteit Leuven, Centrum voor Economische Studiën.
10. Arthur van Soest, 1995. "Structural Models of Family Labor Supply: A Discrete Choice Approach," Journal of Human Resources, University of Wisconsin Press, vol. 30(1), pages 63-88.
11. King, Mervyn A., 1983. "Welfare analysis of tax reforms using household data," Journal of Public Economics, Elsevier, vol. 21(2), pages 183-214, July.
12. John Creedy & Guyonne Kalb, 2005. "Measuring Welfare Changes In Labour Supply Models," Manchester School, University of Manchester, vol. 73(6), pages 664-685, December.

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 HTML HTML with abstract plain text plain text with abstract BibTeX RIS (EndNote, RefMan, ProCite) ReDIF in new window

Cited by:

1. Francesco Figari & Paulus, A. (Alari), 2012. "GINI DP 28: The impact of indirect taxes and imputed rent on inequality: A comparison with cash transfers and direct taxes in five EU countries," GINI Discussion Papers 28, AIAS, Amsterdam Institute for Advanced Labour Studies.
2. Decoster, André & De Swerdt, Kris & Orsini, Kristian, 2008. "A Belgian flat income tax: effects on labour supply and income distribution," Open Access publications from Katholieke Universiteit Leuven urn:hdl:123456789/196767, Katholieke Universiteit Leuven.
   
   • A. Decoster & K. De Swerdt & K. Orsini, 2010. "A Belgian Flat Income Tax: Effects on Labour Supply and Income Distribution," Review of Business and Economic Literature, Intersentia, vol. 0(1), pages 23-55, March.
   • André Decoster & Kris De Swerdt & Kristian Orsini, 2010. "A Belgian Flat Income Tax. Effects on Labour Supply and Income Distribution," Review of Business and Economics, Katholieke Universiteit Leuven, Faculteit Economie en Bedrijfswetenschappen, vol. 0(1), pages 23-54.
   • André Decoster & Kris De Swerdt & Kristian Orsini, 2008. "A Belgian flat income tax: effects on labour supply and income distribution," Center for Economic Studies - Discussion papers ces0820, Katholieke Universiteit Leuven, Centrum voor Economische Studiën.
   • DeCoster, Andre & De Swerdt, Kris & Orsini, Kristian, 2008. "A Belgian flat income tax: effects on labour supply and income distribution," EUROMOD Working Papers EM8/08, EUROMOD at the Institute for Social and Economic Research.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:ner:leuven:urn:hdl:123456789/196761

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Carl Demeyere).

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 references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link 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 profile, as there may be some citations waiting for confirmation.

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

---

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.

Privacy Legal