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Income Tax Preferences for the Elderly


  • Karen Smith Conway

    (University of New Hampshire, Durham)

  • Jonathan C. Rork

    (Georgia State University, Atlanta)


This research investigates the evolution of federal and state income tax preferences for the elderly during the past twenty-five years. Documenting how various types of income tax preferences have changed reveals that state tax policies are not simply mimicking federal tax law. It also shows a divergence in how the different types of state preferences have evolved. The authors explore two explanations for these patterns: the political power of the elderly and state tax competition. They construct a summary measure using representative household profiles created from the Current Population Survey and the TAXSIM calculator for 1977 to 2002. Several patterns emerge that are consistent with both explanations, but data limitations make it difficult to obtain definitive results. The most salient finding is that a proportionately large elderly population is associated with less generous tax preferences for the elderly, which is consistent with a ``program cost'' rather than ``preference'' effect of an aging population.

Suggested Citation

  • Karen Smith Conway & Jonathan C. Rork, 2008. "Income Tax Preferences for the Elderly," Public Finance Review, , vol. 36(5), pages 523-562, September.
  • Handle: RePEc:sae:pubfin:v:36:y:2008:i:5:p:523-562

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    References listed on IDEAS

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

    Cited by:

    1. Lucie Schmidt & Purvi Sevak, 2006. "Taxes, Wages, and the Labor Supply of Older Americans," Working Papers wp139, University of Michigan, Michigan Retirement Research Center.
    2. Schaltegger, Christoph A. & Somogyi, Frank & Sturm, Jan-Egbert, 2011. "Tax competition and income sorting: Evidence from the Zurich metropolitan area," European Journal of Political Economy, Elsevier, vol. 27(3), pages 455-470, September.
    3. Jie Pan & Gary Wagner, 2011. "The Effect of State Tax Preferences on the Living Arrangements of Elderly Individuals," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 17(2), pages 193-210, May.


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