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Behavioral Economics and Tax Policy

  • William Congdon
  • Jeffrey R. Kling
  • Sendhil Mullainathan

Behavioral economics is changing our understanding of how economic policy operates, including tax policy. In this paper, we consider some implications of behavioral economics for tax policy, such as how it changes our understanding of the welfare consequences of taxation, the relative desirability of using the tax system as a platform for policy implementation, and the role of taxes as an element of policy design. We do so by reviewing the logic of specific features of tax policy in light of recent findings in areas such as tax salience, program take-up, and fiscal stimulus.

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File URL: http://www.nber.org/papers/w15328.pdf
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 15328.

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Date of creation: Sep 2009
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Publication status: published as National Tax Journal, 62:3 (September 2009), 375-386.
Handle: RePEc:nbr:nberwo:15328
Note: PE
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  1. George A. Akerlof, 2009. "How Human Psychology Drives the Economy and Why It Matters," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(5), pages 1175-1175.
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