TY  - JOUR
AU  - Bogart,William T.
AU  - Bradford,David F.
AU  - Williams,Michael G.
TI  - Incidence and Allocation Effects of a State Fiscal Policy Shift: The Florio Initiatives in New Jersey
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 4177
PY  - 1993
Y2  - April 1993
UR  - http://www.nber.org/papers/w4177
L1  - http://www.nber.org/papers/w4177.pdf
N1  - Author contact info:
William T.. Bogart
E-Mail: wtbogart@ycp.edu

David F. Bradford
Woodrow Wilson School
Princeton University
Princeton, NJ 08544-1013
Tel: 609/258-1856
Fax: 609/258-2809
E-Mail: BRADFORD@PRINCETON.EDU

Michael G. Williams
AB  - We calculate the incidence of recent changes to the New Jersey state tax system on a sample of homeowners. Our analysis distinguishes between business-as-usual responses to an evolving fiscal situation and tax changes that constitute a surprise. The latter have incidence effects; the former do not. We conclude that, if the changes carried out by NJ Governor Jim Florio are regarded as permanent, they effected a one-time wealth redistribution from, on average, higher-income homeowners toward lower-income homeowners and from owners of suburban residential property toward owners of urban residential property. Although effects on the averages for identifiable groups are clear and significant there is very considerable variation in the effects on individual homeowners within groups. We also estimate the allocation effects of the tax changes using a general equilibrium model that incorporates the option of in-and out migration. The results suggest that the changes will induce a sizable migration of weal thy and high-income people out of the state.
ER  -