Empirical Tax Policy Analysis and Evaluation

Abstract

There are large variations in tax design across countries. The lack of convergence suggests that there is room for national tax policies. When designing a tax system the objectives of equity, efficiency, and stabilization have to be balanced against each other. In Sweden, there is a need for continuously updated empirical estimations, using micro data, of households' and firms' behaviour. For households this concerns, for example: (i) Estimation of expenditure systems, own and cross price elasticities. (ii) Cross effects of factor prices on consumer demand. (iii) Cross effects of consumption prices on factor supply. (iv) Estimation of time use system. For firms it is desirable to learn more about dynamic factor demand and investment.

Keywords: taxation, burden, incidence, distribution, excess burden, deadweight loss, efficiency, automatic stabilizers, stabilization

JEL Classification: E62, H2