Optimal Tax-Transfer Rules under Equilibrium and New Labour Demand Scenarios

Nizamul Islam, Ugo Colombino

Research output: Working paper › Discussion paper

Abstract

We present an extension of the numerical approach to empirical optimal taxation allowed by a peculiar structure of a microeconometric model of labour supply that includes a representation of the demand side. This makes it possible to identify optimal tax-transfer rules while accounting for equilibrium constraints and to evaluate the effects of exogenous labour demand shocks. We provide illustrative examples using the 2015 EU-SILC data set for Italy.
Original languageEnglish
Place of PublicationBonn
PublisherIZA – Institute of Labor Economics
Number of pages24
Publication statusPublished - Jul 2020

Publication series

NameIZA Discussion Papers
PublisherIZA Institute of Labor Econimics
No.13541
ISSN (Electronic)2365-9793

Keywords

  • Empirical optimal taxation
  • microsimulation
  • microeconometrics
  • evaluation of tax-transfer rules
  • equilibrium
  • labour demand shocks

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