The Economic Consequences of Reducing the Implicit Tax Rate: Evidence from a Housing Voucher Program

Author(s):  
Raymond Kluender
2021 ◽  
Author(s):  
Travis Chow ◽  
Sterling Huang ◽  
Kenneth J. Klassen ◽  
Jeffrey Ng

This study examines the effects of jurisdictions’ corporate taxes and other policies on firms’ headquarters (HQ) location decisions. Using changes in state corporate income tax rates across time and states as the setting, we find that a one-percentage-point increase in the HQ state corporate income tax rate increases the likelihood of firms relocating their HQ out of the state by 16.8%, and an equivalent decrease in the HQ state rate decreases the likelihood of HQ relocations by 9.1%. Exploiting the unique tax policy features within the state apportionment system lends strong support to the interpretation that taxation drives this effect. Our analyses also demonstrate that state income tax features affect the destination of the HQ move. We contribute to the literature on corporate decision making by showing how state income taxation affects a real corporate decision that has significant economic consequences for the company and the state. This paper was accepted by Brian Bushee, accounting.


2010 ◽  
Vol 112 (5) ◽  
pp. 1443-1491 ◽  
Author(s):  
Stefanie Deluca ◽  
Peter Rosenblatt

Background Previous research has demonstrated that children growing up in poor communities have limited access to high-performing schools, while more affluent neighborhoods tend to have higher-ranking schools and more opportunities for after-school programs and activities. Therefore, many researchers and policy makers expected not only that the families moving to low-poverty neighborhoods with the Moving to Opportunity (MTO) program would gain access to zone schools with more resources but also that mothers would be more likely to meet middle-class parents who could provide information about academic programs and teachers, leading them to choose some of these new higher-quality-zone schools. However, research evaluating the effects of the MTO program on child outcomes 4-7 years after program moves found that while the schools attended by the MTO children were less poor and had higher average test scores than their original neighborhood schools, the differences were small: Before moving with the program, MTO children attended schools ranked at the 15th percentile statewide on average; 4-7 years after the move, they were attending schools that ranked at the 24th percentile on average. Purpose The fact that the residential changes brought about by the MTO experiment did not translate into much larger gains in school academic quality provides the impetus for our study. In other words, we explore why the experiment did not lead to the school changes that researchers and policy makers expected. With survey, census, and school-level data, we examine where families moved with the MTO program and how these moves related to changes in school characteristics, and how parents considered schooling options. Setting Although the MTO experiment took place in five cities (New York, Boston, Los Angeles, Chicago, and Baltimore), we use data from the Baltimore site only. Population The sample in our study includes the low-income mothers and children who participated in the Baltimore site of the MTO housing voucher experiment. Ninety-seven percent of the families were headed by single black women. The median number of children was two, and average household income was extremely low, at $6,750. Over 60% received Aid to Families with Dependent Children (AFDC) as their primary source of income (at program entry in 1994), over 77% of household heads were unemployed, and 40% of the women had no high school degree or GED. Program The Moving to Opportunity program gave public housing residents in extremely poor neighborhoods in Baltimore, New York, Chicago, Los Angeles, and Boston a chance to apply for the program and move between 1994 and 1998. Families were randomly assigned into one of three groups: an experimental group that received housing counseling and a special voucher that could only be used in census tracts with 1990 poverty rates of less than 10%; a second treatment group, the Section 8 group, that received a regular voucher with no geographic restrictions on where they could move; and a control group that received no voucher through MTO, although they could continue to reside in their public housing units or apply for other housing subsidies (usually a regular Section 8 voucher). The program did not provide assistance with transportation costs, job searches, or local school information after the family relocated. Research Design We use survey data, census data, school-level data, and interviews from the Baltimore site of a randomized field trial of a housing voucher program. We present a mixed-methods case study of one site of the experiment to understand why the children of families who participated in the Baltimore MTO program did not experience larger gains in schooling opportunity. Conclusions Our article demonstrates that in order to discover whether social programs will be effective, we need to understand how the conditions of life for poor families facilitate or constrain their ability to engage new structural opportunities. The described case examples demonstrate why we need to integrate policies and interventions that target schooling in conjunction with housing, mental health services, and employment assistance. Future programs should train mobility counselors to inform parents about the new schooling choices in the area, help them weigh the pros and cons of changing their children's schools, and explain some of the important elements of academic programs and how they could help their children's educational achievement. Counselors could also assuage parents’ fears about transferring their children to new schools by making sure that receiving schools have information about the children and that little instruction time is lost in the transition between schools.


2019 ◽  
Vol 16 (2) ◽  
pp. 535-554
Author(s):  
Rosemary Nonye Ndubuizu

AbstractIn 1982, President Ronald Reagan’s administration initiated a dramatic policy shift towards a new housing voucher program, which simultaneously resulted in a near-halt in public and project-based assisted housing funding. When analyzing this historic policy shift, many affordable housing scholars have overemphasized race-absent narratives about fiscal austerity to explain the Reagan administration’s policy rejection of public housing and embrace of housing vouchers. To present a more comprehensive and intersectional history of the Reagan administration’s transition to housing vouchers, I employ an alternative methodological lens that I call Black feminist critical policy studies. This paper traces how the Office of Management and Budget and Housing and Urban Development officials relied on obscured racial and gender bias in their debate informing Reagan's alternative housing voucher program. By revealing the social bias endemic in the Reagan administration’s housing debate, this article illustrates that housing vouchers were not simply a neutral, cost-efficient policy tool but helped ensure low-income black mothers’ continued subjection to anti-welfare backlash, housing discrimination, and paternal supervision.


2019 ◽  
Vol 59 (4) ◽  
pp. 669-700 ◽  
Author(s):  
Dirk W. Early ◽  
Paul E. Carrillo ◽  
Edgar O. Olsen

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