On the heterogeneous effects of tax policy on labor market outcomes

Wifag Adnan, Kerim Peren Arin, Aysegul Corakci, Nicola Spagnolo

    Research output: Contribution to journalArticle

    Abstract

    Many recent studies have documented the heterogeneous effects of government-spending shocks on major macroeconomic variables, particularly on output. We delve deeper into the heterogeneous effects of fiscal policy innovations, but focus on the tax policy innovations and their impact on the labor market, while accounting for gender, race, ethnicity, and the business cycle. Using microlevel data from the United States, we find that: (i) Tax shocks have varying employment effects depending on gender, race, and the stage of the business cycle; (ii) Sector, industry, and occupational segregation in labor markets by gender, race, and ethnicity can explain most of the variation in response to fiscal policy shocks.
    Original languageEnglish
    Pages (from-to)991-1036
    JournalSouthern Economic Journal
    Volume88
    Issue number3
    DOIs
    Publication statusPublished - 2021

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