Essays in Public Economics

Abstract

This dissertation investigates behavioral responses to taxation across three key domains: labor supply, migration, and tax evasion. Chapter 1 introduces the three papers that make up this dissertation, and places them in the context of the field of public economics. Chapter 2 examines the labor supply effects of the California Earned Income Tax Credit (CalEITC), a state-level supplement to the federal EITC targeted at very-low-income workers with children. Using a triple-difference approach and American Community Survey data, I find that the CalEITC led to a shift from full-time to part-time work among single mothers, particularly those in larger households, consistent with a discrete model of labor supply. Chapter 3, coauthored with Karen Conway and Jonathan Rork, evaluates how state tax preferences for the elderly affect interstate migration. Leveraging tax return data and variation in state policy over two decades, we find that while overall income taxes slightly affect elderly migration, elderly-specific tax breaks do not, suggesting limited behavioral response to these targeted incentives. Chapter 4, coauthored with Daniel Reck, explores how assumptions about income misreporting affect estimates of top income inequality. By creating a formal structure within which to express the work of several competing approaches to estimating the changes in income inequality over the past 60 years, we can separate out economic and methodological drivers of the differences between these approaches. We also review the current state of the economic literature, concluding that relying on audit data to measure misreporting likely understate inequality growth by failing to account for the rise of pass-through income among the very-wealthy.