|
ALISA TAZHITDINOVAI am an Assistant Professor of Economics at UC Santa Barbara.
My research interests are in public economics, labor economics, and psychology and economics. Contact Information:
Department of Economics, UCSB 2127 North Hall, Santa Barbara, CA 93106-9210 Email: tazhitda [at] ucsb.edu |
How to pronounce my last name? "tah-ZHEET-dee-noh-vah," where "zh" is pronounced as "s" in "leisure"
Check out my better half here.
Check out my better half here.
PUBLICATIONS:
"Reducing Evasion Through Self-Reporting: Evidence from Charitable Contributions"
Journal of Public Economics 2018, volume 165 (September), pp. 31-47. Short Slides
In absence of third-party reporting, taxpayers are required to self-report information with various degrees of detail, ranging from uncorroborated claims to comprehensive records with receipts. Using a quasi-experimental design applied to noncash charitable contribution deductions, I show that even basic self-reporting requirements are effective at reducing evasion but impose large compliance costs on taxpayers. I find that simplified reporting requirements reduce reporting costs by $55 per person and substantially increase claimed donations. However, half of the new donations are due to evasion. Thus, information reporting should only be imposed on total reported donations above a pre-specified threshold.
In absence of third-party reporting, taxpayers are required to self-report information with various degrees of detail, ranging from uncorroborated claims to comprehensive records with receipts. Using a quasi-experimental design applied to noncash charitable contribution deductions, I show that even basic self-reporting requirements are effective at reducing evasion but impose large compliance costs on taxpayers. I find that simplified reporting requirements reduce reporting costs by $55 per person and substantially increase claimed donations. However, half of the new donations are due to evasion. Thus, information reporting should only be imposed on total reported donations above a pre-specified threshold.
WORKING PAPERS:
"Does the Magnitude of Incentives Matter? Labor Supply and Demand Responses to an Unusually Large Tax Break"
Presented at the NBER SI Public Finance, Winner of the 2016 IIPF Peggy and Richard Musgrave Prize
I explore labor supply responses to an unusually large notch generated by the “Mini-Job” program in Germany. Using administrative data, I document three findings. First, despite the unusually large magnitude of incentives, earnings elasticities are modest, even after accounting for frictions. Second, the observed response cannot be fully attributed to labor supply alone; instead, the observed outcomes are highly dependent on the availability of jobs and, hence, are strongly influenced by labor demand incentives. Third, I show that these firm incentives are driven by the fact that mini-jobs workers receive lower fringe-benefit payments.
I explore labor supply responses to an unusually large notch generated by the “Mini-Job” program in Germany. Using administrative data, I document three findings. First, despite the unusually large magnitude of incentives, earnings elasticities are modest, even after accounting for frictions. Second, the observed response cannot be fully attributed to labor supply alone; instead, the observed outcomes are highly dependent on the availability of jobs and, hence, are strongly influenced by labor demand incentives. Third, I show that these firm incentives are driven by the fact that mini-jobs workers receive lower fringe-benefit payments.
"Entrepreneurial Entry vs Income Shifting, and the High Cost of Incorporation"
Drawing on administrative panel data covering the full population of entrepreneurs in the UK, I study the effects of lower corporate tax liability on entrepreneurial entry and income shifting. I find that a 10% increase in savings from incorporation leads to a 2.64% increase in the number of new entrepreneurs, and a 2.25% increase in income shifting. Nonetheless, despite large tax savings to incorporation (exceeding 10 pp in some years), a substantial proportion of business owners fails to incorporate. Using a revealed-preference approach, I estimate an average yearly cost of incorpo- ration of more than £3,750.
"When Tax Incentives, Hour Constraints and Job Availabilities Clash: Moonlighting Responses to a Large Tax Reform"
Multiple job holding – or moonlighting – is widespread in OECD countries, with 5 to 10% workers holding two or more jobs. Yet, little is known about the determinants of moonlighting and its responsiveness to tax incentives: research has been held back by the lack of identifying variation as most tax systems treat primary and secondary employments equally. This paper circumvents these limitations by studying a unique reform in Germany that allowed workers to hold small secondary jobs tax-free, thus decreasing the tax rate on secondary earnings by 20% or more. I show that the take up of secondary jobs more than doubled, resulting in participation elasticities that are several times larger than participation elasticities in the primary employment. Moreover, individuals did not reduce earnings at their primary jobs when they obtained new secondary jobs, implying that the observed increase in multiple job holding represents genuine increases in labor force participation. Finally, I explore mechanisms behind the varying rates of response, and find that job availabilities and hour constraints are key determinants of moonlighting.
"Labor Supply Responses to Payroll Taxes in the UK"
I study behavioral responses to changes in marginal tax rates of social security and income taxes. I find that responses depend on individual’s employment status: whether a worker is a wage earner, self-employed, or a proprietor. In line with the existing literature I document weak (but statistically significant) bunching at kink points of the tax schedule among wage earners. Starting from 1999, wage earners accumulate pension credits when they exceed a certain threshold, however, no contributions are due until earnings reach a second, higher threshold. Even 10 years after this reform I find no bunching to the right of the eligibility threshold, suggesting that individuals do not assign a high value to pension benefits. Lack of bunching is persistent across age groups and unlikely to be explained by friction costs as individuals are able to bunch at other kink points. I find strong responses to tax incentives among the self-employed but the responses differ by the type of kink. I find sharp bunching at the first kink, medium bunching at the top kink and weak bunching at the middle kink. Comparing responses before and after a tax reform that changed the magnitude of kinks I find that self-employed individuals aggressively reduce earnings to bunch at the lower, more salient kink points. Finally, I document large income shifting by proprietors: many firm owners report most of income as dividends thus avoiding social security taxes. Nevertheless many proprietors choose to pay themselves sub-optimally high wages thus incurring an unnecessarily high tax liability. I show that some of these proprietors pay multiples of £5,000 or £6,000.
