Intertemporal tax discontinuities

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National Bureau of Economic Research , Cambridge, MA
Securities -- Prices -- United States -- Econometric models., Capital gains tax -- United States -- Econometric models., Securities -- Taxation -- United States -- Econometric models., Capital market -- United States -- Econometric mo
StatementDouglas A. Shackelford, Robert E. Verrecchia.
SeriesNBER working paper series -- working paper 7451, Working paper series (National Bureau of Economic Research) -- working paper no. 7451.
ContributionsVerrecchia, Robert E., National Bureau of Economic Research.
Classifications
LC ClassificationsHB1 .W654 no. 7451
The Physical Object
Pagination34 p. ;
ID Numbers
Open LibraryOL22396649M

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Get this from a library. Intertemporal tax discontinuities. [Douglas A Shackelford; Robert E Verrecchia; National Bureau of Economic Research.] -- Abstract: This paper defines an intertemporal tax discontinuity (ITD) as a circumstance in which different tax rates are applied to gains and losses realized at one point in time versus some other.

Intertemporal Tax Discontinuities Douglas A. Shackelford, Robert E. Verrecchia. NBER Working Paper No. Issued in December NBER Program(s):Public Economics This paper defines an intertemporal tax discontinuity (ITD) as a circumstance in which different tax rates are applied to gains and losses realized at one point in time versus some other point in time, and studies the effects of.

Downloadable. This paper defines an intertemporal tax discontinuity (ITD) as a circumstance in which different tax rates are applied to gains and losses realized at one point in time versus some other point in time, and studies the effects of ITDs on market behaviors at the time of disclosures of firm performance.

The results show that ITDs either depress or amplify trading volume at the time. Downloadable. We define an intertemporal tax discontinuity (ITD) as a circumstance in which different tax rates are applied to gains realized at one point in time versus some other point in time.

We study the effects of ITDs on market behaviors at the time of disclosures of firm performance, assuming that all investors who trade firm equities are subject to tax.

Intertemporal Tax Discontinuities DOUGLAS A. SHACKELFORD* AND ROBERT E. VERRECCHIAt Received 13 August ; accepted 2 August ABSTRACT Intertemporal tax discontinuities book define an intertemporal tax discontinuity (ITD) as a circumstance in which different tax rates are applied to gains realized at one point in time versus some other point in time.

Intertemporal choice is the process by which people make decisions about what and how much to do at various points in time, when choices at one time influence the possibilities available at other points in time.

Download Intertemporal tax discontinuities FB2

These choices are influenced by the relative value people assign to two or more payoffs at different points in time. Most choices require decision-makers to trade off costs and. constraint, we may de–ne a Lagrange multiplier for the intertemporal budget constraint (that is, the lifetime budget constraint): T å t=0 c t Rt = Ra 0, where we have used the fact that a T+1 = 0.

That is, we may write the Lagrangian as follows L = T å t=0 btu(c t)+l Ra 0 T å t=0 c t Rt!, where l is the constant Lagrange multiplier for the File Size: KB. LECTURE 2 INTERTEMPORAL CONSUMPTION OUTLINE -period Consumption Model t Value and Its Applications lio Allocation READING Varian Ch.

File Size: 1MB. Intertemporal Macroeconomics is the first text to offer a unified and systematic exposition of the key issues, both traditional and new, in dynamic macroeconomics.

Based on neoclassical growth theory, the book is designed for graduate and advanced undergraduate students in macroeconomics and finance.4/5(1). Intertemporal Government Budget Constraint.

Tax and spending decisions at different dates are linked. Although governments can borrow or lend in a given year, a government’s total spending over time must be matched with revenues.

When a government runs a deficit, it typically borrows to finance it. the tax, making it is easier to identify the intertemporal substitution and income effects associated with the rate increase.

We choose to focus only on the VAT increase since the VAT introduction coincided with the removal of several other indirect and excise taxes, and thus.

1IntertemporalChoices We now extend our framework to incorporate “intertemporal decisions”, i.e. decisions that involve a trade-offbetween the present and the future.

The vast majority of important economic decisions are of this type: • the consumption decision involves a File Size: KB. Economic theories of intertemporal consumption seek to explain people's preferences in relation to consumption and saving over the course of their lives.

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The earliest work on the subject was by Irving Fisher and Roy Harrod, who described 'hump saving', hypothesizing that savings would be highest in the middle years of a person's life as they saved for : List of largest consumer markets. The intertemporal choice and saving are two important concepts of economics.

The intertemporal choice allows a study on the assigning of relative value to the two or more than two payoffs at the various times. John Rae introduced intertemporal choice in the year of.

Intertemporal Choice: An economic term describing how an individual's current decisions affect what options become available in the future. Theoretically, by not consuming today, consumption Author: Daniel Liberto.

In economics and finance, an intertemporal budget constraint is a constraint faced by a decision maker who is making choices for both the present and the future. In its general form it says that the present value of current and future cash outflows cannot exceed the present value of currently available funds and future cash inflows.

Typically this is expressed as. The Effect of Anticipated Tax Changes on Intertemporal Labor Supply and the Realization of Taxable Income Adam Looney and Monica Singhal NOTE: Staff working papers in the Finance and Economics Discussion Series (FEDS) are preliminary materials circulated to stimulate discussion and critical comment.

The. The Intertemporal Government Budget Constraint In order to examine the relationship which exists between the government's fiscal stance and the performance of the macroeconomy, the appropriate framework is the government's intertemporal budget constraint.

This can be written either in nominal terms and\or as a. Intertemporal choice is the study of how people make choices about what and how much to do at various points in time, when choices at one time influence the possibilities available at other points in time.

These choices are influenced by the relative value people assign to two or. Tax burdens are also shifted intertemporally, onto cohorts not yet born. In order to assess the possible extent of intertemporal generational redistribution associated with a specific tax and transfer policy, generational accountants construct stylized generational accounts for future : Holger Bonin.

A Tax-Based Estimate of the Elasticity of Intertemporal Substitution Jonathan Gruber. NBER Working Paper No. Issued in January NBER Program(s):Economic Fluctuations and Growth, Public Economics One of the most important behavioral parameters in macroeconomics is the elasticity of intertemporal substitution (EIS).

Chapter Intertemporal Choice Introduction We are now in a position to apply our methodology in a variety of contexts, including two particularly important ones – intertemporal choice and risky choice.

As we will see, we can use the apparatus we have constructed to analyse these interesting problems. We start with intertemporal choice. A Tax-Based Estimate of the Elasticity of Intertemporal Substitution Jonathan Gruber Massachusetts Institute of Technology Department of Econom Memorial Drive Building E52, Room Cambridge MA, [email protected] Published 28 June One of the most important behavioral parameters in macroeconomics is the elasticity.

Tax Compliance and the Neuroeconomics of Intertemporal Substitution discounting to an Allingham–Sandmo framework to discuss how the timing of the payment of taxes and refunds can affect the level of compliance. It par-ticular, it argues that, under hyperbolic or quasi–hyperbolic models of temporal discounting, one would expect to observeCited by: A Two-Period Model Consumers Experiments Introduction Intertemporal Decisions Macroeconomics studies how key variables evolve over time The simplest way to think about intertemporal decisions is in a two-period model The first period is the current period (or today) The second period represents the future (or tomorrow) Key trade-off: consuming today or consuming in the future,File Size: 1MB.

Rates of saving in America have never been especially high, but they seem to have dipped even lower in recent years, as the data from the Bureau of Economic Analysis in Figure 1 show.

Description Intertemporal tax discontinuities EPUB

A decision about how much to save can be represented using an intertemporal budget old decisions about the quantity of financial savings show the same underlying pattern of logic as the. The price ratio is the real interest rate: i.e., the cost of increasing consumption today, which is foregone consumption tomorrow - based on interest rate and inflation.

Jappelli and Pistaferri Intertemporal Choice and Consumption Mobility 79 From through the survey was conducted every other year and covered about 8, households, defined as groups of individuals related by blood, marriage, or adoption and sharing the same dwelling.

Starting ineach. Interest Rates, Debt and Intertemporal Allocation: Evidence From Notched Mortgage Contracts in the UK Michael Carlos Best, Stanford University James Cloyne, Bank of England Ethan Ilzetzki, London School of Economics Henrik Jacobsen Kleven, London School of Economics August AbstractFile Size: KB.

The tax terms t1 and t2 on the left-hand-side represent the fact that taxes are an expenditure item for the consumer. Proceeding as we have done a couple of times now, we can derive the LBC for the consumer: 22 2 11 1 ct y ct y rr r, (35) or, moving the tax terms to the right-hand-side, 2 22 c y t .P intertemporal choice Decisions that have consequences in multiple time periods are intertemporal choices.

Individuals typically discount delayed rewards much more than can be explained by mortality effects. The most common discount function is exponential in form, but hyperbolic and quasi-hyperbolic functions seem to explain empirical File Size: KB.

Topic 1a: Intertemporal Choice Econom Summer Andreas Bentz Based Primarily on Varian, Ch. 10 Dartmouth College, Department of Economics: Econom Summer‘02‘02 Background Discounting.