NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH
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Stuart Adam

Institute for Fiscal Studies
7 Ridgmount Street
London WC1E 7AE
United Kingdom

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Institutional Affiliation: Institute for Fiscal Studies

NBER Working Papers and Publications

April 201735 Years of Reforms: A Panel Analysis of the Incidence of, and Employee and Employer Responses to, Social Security Contributions in the UK
with David Phillips, Barra Roantree: w23336
We exploit variation in National Insurance contributions (NICs) – the UK’s system of social security contributions – and a large panel dataset to examine the effects of 35 years of employee and employer NICs reforms on labour cost (gross earnings plus employer NICs), hours of work and labour cost per hour, both immediately (0–6 months) after reforms are implemented and in the slightly longer term (12–18 months). We consider assumptions under which the estimated coefficients on net-of-marginal and net-of-average tax rates in a panel regression can be interpreted as behavioural elasticities or as reflecting incidence. We find a compensated elasticity of taxable earnings with respect to the marginal rate of employee NICs of about 0.2–0.3, operating largely through hours of work, while that wi...

Published: Stuart Adam & David Phillips & Barra Roantree, 2018. "35 years of reforms: A panel analysis of the incidence of, and employee and employer responses to, social security contributions in the UK," Journal of Public Economics, . citation courtesy of

July 201635 Years of Reforms: A Panel Analysis of the Incidence of, and Employee and Employer Responses to, Social Security Contributions in the UK
with David Phillips, Barra Roantree
in Social Insurance Programs (Trans-Atlantic Public Economic Seminar, TAPES), Roger Gordon, Andreas Peichl and James Poterba, organizers
 
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