What Is Behind People’s Views On Tax Policy?

When economists study taxation, they typically separate two issues: one is the distributional issue of which groups are paying more or less; the other is the ways in which taxes reduce efficient economic incentives for work, savings, investment, innovation, and so on. Today is the deadline for when US individual income tax returns are due with the federal Internal Revenue Service as well as with state-level income tax authorities. According to the research of Stefanie Stantcheva, most of those taxpayers focus almost entirely on the distributional question, not the efficiency question. 

Stancheva discusses the topic as part of an interview with David Cutler on the occasion of winning the 2020 Elaine Bennett Research Prize, which is \”awarded every two years to recognize and honor outstanding research in any field of economics by a woman not more than seven years beyond her Ph.D.\” (CSWEP Newsletter, 2021, 21:1, \”Interview with Bennett Prize Winner Stefanie Stantcheva\”). The underlying research paper by Stantcheva being discussed here is \”Understanding Tax Policy: How Do People Reason\” (November 2020, NBER Working Paper 27699).Stantcheva reports in the interview: 

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