ORCID Profile
0000-0001-8252-469X
Current Organisation
Australian National University
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Macroeconomics (incl. Monetary and Fiscal Theory) | Public Economics- Taxation and Revenue | Welfare Economics | Applied Economics
Publisher: Elsevier BV
Date: 04-2018
Publisher: Elsevier BV
Date: 10-2012
Publisher: Elsevier BV
Date: 11-2017
Publisher: Elsevier BV
Date: 06-2022
Publisher: Elsevier BV
Date: 11-2015
Publisher: Cambridge University Press (CUP)
Date: 21-02-2019
DOI: 10.1017/S1365100516001292
Abstract: A challenge that faces many advanced economies is how to finance age-related spending programs as the population ages. In this paper, we investigate two policy options–pension cuts and tax hikes–to mitigate fiscal pressure arising in the special context of Australia, whose population is ageing fast while growing substantially in size due to immigration. Using a computable overlapping generations model, we find that while both policy reforms can achieve a similar fiscal goal, they lead to different distributional and welfare effects across income groups over time. Future generations prefer pension cuts, whereas current generations prefer tax hikes to finance government spending commitments. Moreover, within the tax hike option, taxing income or consumption results in opposing macroeconomic and welfare effects. Indeed, our opposing intra- and inter-temporal welfare outcomes highlight some political complexity when devising a more sustainable tax-transfer system.
Publisher: Elsevier BV
Date: 2016
DOI: 10.2139/SSRN.2735966
Publisher: Elsevier BV
Date: 2022
Publisher: Elsevier BV
Date: 06-2016
Publisher: Wiley
Date: 03-03-2023
Abstract: This paper studies the nature of earnings dynamics in Australia, using the Household, Income and Labour Dynamics in Australia (HILDA) Survey 2001–2020. Our results indicate that the distribution of earnings shocks displays negative skewness and excess kurtosis, deviating from the conventional linearity and normality assumptions. Wage changes are strongly associated with earnings changes and account more for the dispersion of earnings shocks meanwhile, the contribution of hour changes is largely absent in upward movement and relatively small in downward movement of earnings changes. Furthermore, family and government insurance plays distinct roles in reducing exposure to earnings risk. Government insurance embedded in the targeted transfer system is important in mitigating the dispersion of shocks, whereas family insurance via income pooling and adjustment of secondary earners' labour market activities is dominant in reducing the magnitude and likelihood of extreme and rare shocks. The magnitude and persistence of earnings risk as well as the insurance role of family and government vary significantly across gender, marital and parental status. Accounting for these non‐Gaussian and non‐linearity features is important for evaluating the insurance role of government transfer programmes.
Publisher: Elsevier BV
Date: 04-2009
Publisher: Oxford University Press (OUP)
Date: 14-02-2023
DOI: 10.1093/JEEA/JVAD010
Abstract: We study the optimal progressivity of personal income taxes in a general equilibrium overlapping generations model where in iduals are exposed to idiosyncratic shocks to labor productivity and health status over the lifecycle. Our results—based on a calibration to the US economy—indicate that both, the presence of health risk and the available insurance institutions, have a strong effect on the optimal level of tax progressivity. Given the fragmented and non-universal health insurance system in the US, a welfare maximizing income tax system is substantially more progressive than the current US income tax. The higher progressivity provides additional redistribution and social insurance, especially for unhealthy low income in iduals who have limited access to health insurance. When exposure to health risk is removed or reduced by introducing more comprehensive health insurance systems, we observe large decreases in the optimal level of income tax progressivity, and the optimal tax system resembles findings from the previous literature. These findings highlight the importance of accounting for the unique characteristics of health risk and the design of the health insurance system when characterizing optimal income taxes.
Publisher: Springer Science and Business Media LLC
Date: 10-12-2013
Publisher: Elsevier BV
Date: 2008
DOI: 10.2139/SSRN.1024556
Publisher: Cambridge University Press (CUP)
Date: 03-2018
DOI: 10.1017/S1365100516000298
Abstract: We formulate an overlapping-generations model with household heterogeneity and productive and nonproductive government programs to study the macroeconomic and intergenerational welfare effects of risk premium shocks and government debt reductions. We demonstrate that in a small open economy with a high level of debt, a small increase in the risk premium of the interest rate leads to a substantial contraction in output and negative welfare effects. We then quantify the effects of reducing the debt-to-gross-domestic-product ratio using a wide range of fiscal austerity measures. Our results indicate trade-offs between short-run contractions and long-run expansions in aggregate output. In the short run, spending-based austerity reforms are worse than tax-based reforms in terms of lost income. However, in the long run, spending-based reforms produce higher output than tax-based reforms. In addition, welfare effects vary significantly across generations, skill groups, and working sectors. The current old and middle-aged generations experience welfare losses, whereas future generations are beneficiaries of the reforms.
Publisher: Elsevier BV
Date: 04-2016
Publisher: Elsevier BV
Date: 2016
DOI: 10.2139/SSRN.2940457
Publisher: Elsevier BV
Date: 11-2012
Publisher: Wiley
Date: 13-12-2020
Publisher: Elsevier BV
Date: 12-2021
Publisher: Elsevier BV
Date: 10-2014
Publisher: Elsevier BV
Date: 03-2018
Start Date: 2021
End Date: 2024
Funder: Australian Research Council
View Funded ActivityStart Date: 2010
End Date: 2011
Funder: Agency for Healthcare Research and Quality
View Funded ActivityStart Date: 06-2021
End Date: 06-2024
Amount: $219,000.00
Funder: Australian Research Council
View Funded Activity