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A Note on Automatic Stabilizers in Austria: Evidence from ITABENA

Author

Listed:
  • Helmut Hofer
  • Tibor Hanappi
  • Sandra Müllbacher

    (Institut für Höhere Studien (IHS) / Department of Economics & Finance)

Abstract

In the Great Recession market income of the households in Austria has been reduced and unemployment increased. In this paper we examine the impact of automatic stabilizers on cushioning such income losses. We use ITABENA, an Austrian tax-benefit model, to analyze how shocks on market income and employment are mitigated by taxes and transfers. In the case of a proportional income shock 46 percent of the shock will be absorbed by automatic stabilizers in Austria. For the unemployment shocks automatic stabilizers absorb 68 percent. Automatic stabilizers increase the redistributive effects of the Austrian tax benefit system. We find that recent changes in the income tax code have almost no impact on the size of automatic stabilizers in Austria.

Suggested Citation

  • Helmut Hofer & Tibor Hanappi & Sandra Müllbacher, 2012. "A Note on Automatic Stabilizers in Austria: Evidence from ITABENA," NRN working papers 2012-03, The Austrian Center for Labor Economics and the Analysis of the Welfare State, Johannes Kepler University Linz, Austria.
    • Handle: RePEc:jku:nrnwps:2012_03
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    Citations

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    Cited by:

    1. Sandra Müllbacher & Wolfgang Nagl, 2017. "Labour supply in Austria: an assessment of recent developments and the effects of a tax reform," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 44(3), pages 465-486, August.
    2. AILINCA, Alina Georgeta, 2014. "Automatic Social Stabilizers What They Are And How They Function," Studii Financiare (Financial Studies), Centre of Financial and Monetary Research "Victor Slavescu", vol. 18(3), pages 45-57.
    3. AILINCĂ, Alina Georgeta, 2015. "Automatic Monetary Stabilizers – A Solution For A Better Monetary Policy And Economy Functioning," Journal of Financial and Monetary Economics, Centre of Financial and Monetary Research "Victor Slavescu", vol. 2(1), pages 47-58.
    4. Bruno Rossmann & Christa Schlager, 2012. "Budgetpolitik in Österreich vor und nach der Finanz- und Wirtschaftskrise," Wirtschaft und Gesellschaft - WuG, Kammer für Arbeiter und Angestellte für Wien, Abteilung Wirtschaftswissenschaft und Statistik, vol. 38(2), pages 248-272.
    5. repec:clr:wugarc:y:2012:v:38i:2p:248 is not listed on IDEAS

    More about this item

    Keywords

    automatic stabilization; microsimulation; tax reforms;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E63 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Comparative or Joint Analysis of Fiscal and Monetary Policy; Stabilization; Treasury Policy
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household

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