Category Tax policy
The Irrelevance of Universal Basic Income
The Modigliani Miller Theorem says that a firm's financing policy is irrelevant. It's wrong of course, but it's a good place to start thinking about firms' financing policies. It would be presumptuous to talk about an Irrelevance "Theorem" for Basic Income. The math is trivial, and the economics is obvious. (And I hope this is […]
Bargaining power and the incidence of taxes on high earners in Canada
Today I'm presenting a paper at the meetings of the Canadian Economics Association: "Bargaining power and the incidence of taxes on high earners in Canada." The bottom line is that once you take into account the fact that high earners have bargaining power – that's why they are high earners in the first place! – […]
Gender-Based Analysis: A Guide for Economists
GBA+ [Gender-Based Analysis plus] is an analytical tool used to assess the potential impacts of policies, programs, services, and other initiatives on diverse groups of women and men, taking into account gender and other identity factors. The "plus" in the name highlights that GBA+ goes beyond gender, and includes the examination of a range of other […]
Two Problems with Designing a Basic Income Experiment
WARNING: I don't do (micro) Public Finance. And I don't do experimental economics. Those who have read the literature may tell me they are well aware of these problems, or that I'm wrong about something. Suppose someone asked me to design an experiment to test whether Basic Income would be a Good thing. (They wouldn't […]
Conceptually costing Basic Income
Micro public finance is not my area, so take this post with a big heap of salt. But: Q. How much would it cost to implement a Basic Income, where everyone gets (say) $10,000 per year? The normal way to approach that question is to multiply $10,000 by the population, then subtract the cost of […]
How much revenue will the Liberals generate with a new tax bracket on high earners?
[I started writing this post in May, but I stopped when it looked like the Liberals were not going to be in a position to implement this measure. Happily, I didn't actually delete it.] [An earlier version made a stupid mistake; I did everything under tha assumption that the increase was 3 percentage points, and […]
The Best and Worst Tax Measures of Budget 2015
The 2015 federal budget is intended to be "a balanced budget, low tax plan for jobs, growth and security." US experience shows that low taxes are no guarantee of jobs and growth. In fact, a recent study by the IMF found equality matters more for growth than low taxes. I quote: "lower net inequality is […]
Consuming wealth without spending a dime
"It is a great comfort to have you so rich" - Jane Austen, Pride and Prejudice. Stripped down to the barest essentials, taxation works like this: taxes owing = tax rate * tax base + lump sum taxes – income guarantees and tax credits. The appropriate tax base, rate and income guarantee are the three fundamental […]
Funding the gerontocracy
This year, the per-vote subsidy once enjoyed by Canadian political parties ends. Parties will have to raise funds entirely through donations. So, who gives? There is a generous federal tax credit for political donations, worth 75 percent of the first $400 donated, 50 percent of the next $350, and 33 percent of remaining donations. The federal tax credit […]
The Children’s Fitness Tax Credit: A Study in (Academic) Incentives
The Children's Fitness Tax Credit gives parents a non-refundable tax credit to recognize the cost of registering children in sports. When the credit was first introduced, its cash value was $77.50 – the amount of the credit ($500) times the basic marginal tax rate (then 15.5%). The popularity of the credit among parents has led […]
Worthwhile Canadian Initiative 
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