Jon M. Bakija
Department of Economics
24 Hopkins Hall Dr.
Williamstown, MA 01267
Information about this author at RePEc
NBER Working Papers and Publications
|August 2008||How Does Charitable Giving Respond to Incentives and Income? Dynamic Panel Estimates Accounting for Predictable Changes in Taxation|
with Bradley Heim: w14237
We estimate the elasticity of charitable giving with respect to its price and after-tax income using a panel of over 550,000 disproportionately high-income tax returns spanning the years 1979 through 2005. Improvements relative to the previous literature include: using state tax variation to help identify our model while controlling for both individual- and time-specific unobserved heterogeneity; carefully dealing with expectations; allowing people at different income levels to have different degrees responsiveness to taxation and different time paths of unobservable influences on giving; and using a measure of charitable giving that more closely approximates current donations. To address the omitted variable bias that would otherwise arise from failing to control for unobservable expecta...
|July 2004||Do the Rich Flee from High State Taxes? Evidence from Federal Estate Tax Returns|
with Joel Slemrod: w10645
This paper examines how changes in state tax policy affect the number of federal estate tax returns filed in each state, utilizing data on federal estate tax return filings by state and wealth class for 18 years between 1965 and 1998. Controlling for state- and wealth-class specific fixed effects, we find that high state inheritance and estate taxes and sales taxes have statistically significant, but modest, negative impacts on the number of federal estate tax returns filed in a state. High personal income tax and property tax burdens are also found to have negative effects, but these results are somewhat sensitive to alternative specifications. This evidence is consistent with the notion that wealthy elderly people change their real (or reported) state of residence to avoid high state tax...
|May 2003||Charitable Bequests and Taxes on Inheritance and Estates: Aggregate Evidence from Across States and Time|
with William Gale, Joel Slemrod: w9661
One recurring issue in the debate over the estate tax is its impact on the non-profit sector. With the top marginal rate of federal estate tax currently at 49 percent, abolishing the tax would approximately double the price of a charitable bequest relative to an ordinary bequest for the wealthiest estates. It would also, however, raise the after-tax wealth of decedents, so the ultimate impact of any particular policy change depends in part on the relative sizes of the price and wealth elasticities. This paper estimates the impact of taxes on charitable bequests using an econometric framework that exploits the fact that federal and state tax rates on estates and inheritances have changed over time in different ways across states and real wealth levels. The effect of federal and state inh...
Published: Bakija, Jon M., William G. Gale and Joel B. Slemrod. "Charitable Bequests And Taxes On Inheritances And Estates: Aggregate Evidence From Across States And Time," American Economic Review, 2003, v93(2,May), 366-370. citation courtesy of
|March 2000||Does Growing Inequality Reduce Tax Progressivity? Should It?|
with Joel Slemrod: w7576
This paper explores the links between two phenomena of the past two decades: striking increase in the inequality of pre-tax incomes, and the failure of tax-and-transfer progressivity to increase. We emphasize the causal links going from inequality to progressivity, noting that optimal taxation theory predicts that growing inequality should increase progressivity. We discuss public choice alternatives to the optimal progressivity framework. The paper also addresses the opposite causal direction: that it is changes in taxation that have caused an apparent increase in inequality. Finally, we discuss the non-event-study' offered by the large changes in the distribution of income--with no major tax changes-- since 1995, and discuss its implications for the link between progressivity and ine...
Published: Hassett, K. and R. G. Hubbard (eds.) Inequality and Tax Policy. Washington, DC: The AEI Press for the American Enterprise Institute, 2001.