NBER

Hans A. Holter

Department of Economics
University of Oslo
P.O. Box 1095 Blindern
0317 Oslo
Norway
Tel: +46-18-4711594

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Institutional Affiliation: University of Oslo

NBER Working Papers and Publications

November 2014How Does Tax Progressivity and Household Heterogeneity Affect Laffer Curves?
with Dirk Krueger, Serhiy Stepanchuk: w20688
How much additional tax revenue can the government generate by increasing labor income taxes? In this paper we provide a quantitative answer to this question, and study the importance of the progressivity of the tax schedule for the ability of the government to generate tax revenues. We develop a rich overlapping generations model featuring an explicit family structure, extensive and intensive margins of labor supply, endogenous accumulation of labor market experience as well as standard intertemporal consumption-savings choices in the presence of uninsurable idiosyncratic labor productivity risk. We calibrate the model to US macro, micro and tax data and characterize the labor income tax Laffer curve under the current choice of the progressivity of the labor income tax code as well as whe...

Published: Hans A. Holter & Dirk Krueger & Serhiy Stepanchuk, 2019. "How do tax progressivity and household heterogeneity affect Laffer curves?," Quantitative Economics, Econometric Society, vol. 10(4), pages 1317-1356, November. citation courtesy of

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