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The Digest

A free monthly publication featuring non-technical summaries of research on topics of broad public interest.
Comparative Returns on IRS Audits by Income Groups figure
The US Internal Revenue Service (IRS) estimates that in the middle of the last decade, underreporting of income on individual income tax returns accounted for roughly $300 billion in unpaid taxes. Additionally, research suggests that more than half of this total is associated with taxpayers in the top 10 percent of the income distribution. Audits of tax returns are an important tool for collecting unpaid taxes. Audits of high-income taxpayers may have greater potential...

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A ‘Light Touch’ Intervention Gets Mothers Talking to Their Babies figure
The importance of verbal engagement for infant language and cognitive development is well established, but many low-income parents do not converse with their infants regularly. This compounds the disadvantages faced by children in poorer families. In Informing Mothers about the Benefits of Conversing with Infants: Experimental Evidence from Ghana (NBER Working Paper 31264), Pascaline Dupas, Camille Falezan, Seema Jayachandran, and Mark P....
Heat Pumps: ‘Green Tech’ That Cuts across the Income Distribution Figure
Green technologies tend to be adopted disproportionately by high-income households. For example, the top 20 percent of the income distribution in the United States receives 60 percent of the tax credits for rooftop solar power and 90 percent of the tax credits for electric vehicles. In contrast, heat pump adoption is broadly dispersed across the income distribution, according to a new study, The Economic Determinants of Heat Pump Adoption (NBER Working Paper...
The COVID pandemic had a mixed effect on the gig economy. On the one hand, the overall number of contract and freelance workers fell. This is evident from the number of individual income tax returns that report Form 1099 income capturing these activities. On the other hand, the number of individuals with income from jobs in which assignments arrive via online platforms soared by 3.1 million between 2020 and 2021, with most of the increase in transportation and food...
A pandemic-driven debt relief measure freezing student loan repayments provided a large stimulus to the economy while raising long-term debt burdens, according to a study by Michael Dinerstein, Constantine Yannelis, and Ching-Tse Chen. Their findings, in Debt Moratoria: Evidence from Student Loan Forbearance (NBER Working Paper 31247), are based on comparison of financial outcomes of borrowers who were eligible for the repayment deferral and...
In 2017, Oregon became the first state to implement an auto-enrollment Individual Retirement Account (IRA) program. Illinois and California soon followed. Another 19 states have taken steps to create one. Under such programs, the state receives payroll data from companies without retirement plans and informs their employees that they will be enrolled in the state’s IRA program unless they opt out. For workers who do not opt out, the employer sends a share of each...
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