Show simple item record

2016-08-18Buch DOI: 10.18452/4635
Revisiting the effect of VAT changes on output
dc.contributor.authorVoigts, Simon
dc.date.accessioned2017-06-16T01:26:33Z
dc.date.available2017-06-16T01:26:33Z
dc.date.created2017-02-08
dc.date.issued2016-08-18
dc.date.submitted2016-08-18
dc.identifier.issn1860-5664
dc.identifier.urihttp://edoc.hu-berlin.de/18452/5287
dc.description.abstractStandard models used in academic and institutional research implement the value-added tax (VAT) as a simple consumption tax levied on consumers, implying that tax changes instantaneously translate into consumer price changes. This corresponds to immediate tax pass-though, which is, however, inconsistent with a wealth of empirical evidence for gradual pass-through. I investigate how empirically plausible pass-through dynamics affect VAT multipliers in a New-Keynesian DSGE model relative to instantaneous pass-through under the conventional modeling strategy. To this end, I propose an approach to reconcile passthrough in the model with empirical estimates, and find that short-run multipliers decline by about 50% once we account for empirically observed pass-through dynamics. Standard models thus dramatically overestimate the short-run impact of VAT changes.eng
dc.language.isoeng
dc.publisherHumboldt-Universität zu Berlin, Wirtschaftswissenschaftliche Fakultät
dc.subjectFiscal multiplierseng
dc.subjectvalue added taxeng
dc.subjecttax pass-througheng
dc.subjectDSGE modelseng
dc.subject.ddc310 Statistik
dc.subject.ddc330 Wirtschaft
dc.titleRevisiting the effect of VAT changes on output
dc.typebook
dc.subtitleThe importance of pass-through dynamics
dc.identifier.urnurn:nbn:de:kobv:11-100243744
dc.identifier.doihttp://dx.doi.org/10.18452/4635
local.edoc.container-titleSonderforschungsbereich 649: Ökonomisches Risiko
local.edoc.pages33
local.edoc.type-nameBuch
local.edoc.container-typeseries
local.edoc.container-type-nameSchriftenreihe
local.edoc.container-volume2016
local.edoc.container-issue26
local.edoc.container-year2016
local.edoc.container-erstkatid2195055-6

Show simple item record