000			03128cam a22003857 4500
001			w13330
003			NBER
005			20211020111958.0
006			m o d
007			cr cnu||||||||
008			210910s2007 mau fo 000 0 eng d
100	1		_aChetty, Raj. _97917
245	1	0	_aSalience and Taxation: _bTheory and Evidence / _cRaj Chetty, Adam Looney, Kory Kroft.
260			_aCambridge, Mass. _bNational Bureau of Economic Research _c2007.
300			_a1 online resource: _billustrations (black and white);
490	1		_aNBER working paper series _vno. w13330
500			_aAugust 2007.
520	3		_aA central assumption in public finance is that individuals optimize fully with respect to the incentives created by tax policies. In this paper, we test this assumption using two empirical strategies. First, we conducted an experiment at a grocery store where we posted tax-inclusive prices for 750 products subject to sales tax for a three week period. Using scanner data, we find that posting tax-inclusive prices reduced demand by roughly 8 percent among the treated products relative to control products and nearby control stores. Second, we find that state-level increases in excise taxes (which are included in posted prices) reduce aggregate alcohol consumption significantly more than increases in sales taxes (which are added at the register and hence less salient). Both sets of results indicate that tax salience affects behavioral responses. We propose a bounded rationality model to explain why salience matters, and show that it matches our evidence as well as several additional stylized facts. In the model, agents incur second-order (small) utility losses from ignoring some taxes, even though these taxes have first-order (large) effects on social welfare and government revenue. Using this theoretical framework, we develop elasticity-based formulas for the efficiency cost and incidence of commodity taxes when agents do not optimize fully.<br><br>
520	3		_aA revised version of this paper with new theoretical results may be downloaded here: <br> <a href="http://elsa.berkeley.edu/~chetty/papers/taxsalience_aer.pdf">http://elsa.berkeley.edu/~chetty/papers/taxsalience_aer.pdf</a>
530			_aHardcopy version available to institutional subscribers
538			_aSystem requirements: Adobe [Acrobat] Reader required for PDF files.
538			_aMode of access: World Wide Web.
588	0		_aPrint version record
690		7	_aD11 - Consumer Economics: Theory _2Journal of Economic Literature class.
690		7	_aH0 - General _2Journal of Economic Literature class.
690		7	_aJ0 - General _2Journal of Economic Literature class.
690		7	_aK34 - Tax Law _2Journal of Economic Literature class.
700	1		_aLooney, Adam. _927290
700	1		_aKroft, Kory.
710	2		_aNational Bureau of Economic Research.
830		0	_aWorking Paper Series (National Bureau of Economic Research) _vno. w13330.
856	4	0	_uhttps://www.nber.org/papers/w13330
856			_yAcceso en línea al DOI _uhttp://dx.doi.org/10.3386/w13330
942			_2ddc _cW-PAPER
999			_c334770 _d293332