Office of Tax Policy

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THE OFFICE OF TAX POLICY RESEARCH
is a research office at the Stephen M. Ross School of Business at the University of Michigan. OTPR supports and disseminates academic research on all aspects of the tax system, with the goal of informing discussion about the future course of policy. We are non-partisan and advocate no particular policies.

Richard Musgrave Visiting Professorship

In 2008, the CESifo Group and the International Institute of Public Finance (IIPF) established the Richard Musgrave Visiting Professorship to honor the memory of one of Public Finance's greatest scholars. This annual prize honors an outstanding scholar in the area of Public Finance. With this award the prize winner is also names a Distinguished CESifo Fellow. The award winner is chosen through a formal selection process by the President and Vice Presidents of IIPF together with the President of the CESifo Group.

The 2013 award winner is Professor Joel Slemrod. Professor Slemrod has made vast contributions to research on all aspects of taxation and tax policy. Based on his expertise, Professor Slemrod has also served as a consultant to the U.S. Department of the Treasury, the Canadian Department of Finance, the New Zealand Department of Treasury, the South African Ministry of Finance, the World Bank, and the OECD.

On April 11, 2013, as part of his visiting professorship, he delivered the fifth Richard Musgrave Lecture on the topic of "Insights from a Tax-Systems Perspective."

The March, 2012 Journal of Economic Literature article, "The Elasticity of Taxable Income with Respect to Marginal Tax Rates: A Critical Review, written by Emmanuel Saez, Joel Slemrod, and Seth H. Giertz was recently cited in the 2013 Economic Report of the President. Chapter 3 highlights federal income tax reform and cites page 4 of the JEL article to support how "High tax rates, combined with a complex tax system and a narrow base...provide incentives for taxpayers to...alter behavior in...ways to reduce tax liability." For more information, see Slemrod's latest book (co-authored with Leonard E. Burman) titled Taxes in America: What Everyone Needs to Know published by Oxford University Press.

Also cited in the same chapter is an article written by James R. Hines Jr., Hilary Hoynes, and Alan B. Krueger titled "Another Look at Whether a Rising Tide Lifts All Boats" published in The Roaring Nineties: Can Full Employment Be Sustained, edited by Alan B. Krueger and Robert Solow, New York: Russell Sage Foundation, 2001. The ERP cites page 496 of this article as finding that "all components of State and local government spending are procyclical, with capital spending (on highways, parks, and recreation, for example) generally more procyclical than current spending (on health and education, for example).

VIDEO FILES: ASK THE TAX PROFESSOR

Taxes are a volatile subject in many conversations. Should one group pay more than another? Why do corporations pay less in taxes than individuals do? Why is the U.S. tax system so complex? In order to answer some of these questions, OTPR is sponsoring a video series entitled “Ask the Tax Professor.” In this series, Professor Joel Slemrod answers these and many other tax questions that Americans are asking.

To learn more, visit our News & Events Page.

LESSONS ABOUT TAX REFORM FROM 1986

Everyone seems to agree that it's a good idea to place tax reform at the heart of a package of policies to stave off the fiscal cliff and address the long-term fiscal imbalance. But what can it accomplish other than raising revenue without raising tax rates? One set of lessons comes from the consequences of the last major income tax reform in the United States, the Tax Reform Act of 1986. In a survey article published in the 1997 Journal of Economic Literature, Alan Auerbach and Joel Slemrod investigated this issue. Read what they concluded in:

http://ideas.repec.org/a/aea/jeclit/v35y1997i2p589-632.html

LESSONS FOR TAX POLICY IN THE GREAT RECESSION

While policy makers struggle with identifying and enacting the appropriate short-term policy response to the recent financial crisis and economic downturn, both academics and policy makers are examining the causes of the crisis and what lessons this might bring to bear on longer-term policy. With near unanimity attention to both the causes and appropriate long-term policy response has focused on the financial sector, although fiscal policy, including tax policy, has certainly figured prominently in countries’ short-term policy response to the economic contraction. In recent months, though, officials from two international organizations, the IMF and the OECD, have produced reports addressing what aspects of the tax system may have helped cause or exacerbate the crisis, and whether tax policy needs to be re-evaluated in light of the recent events. In this article OTPR Director Joel Slemrod offers some speculations about the lessons for tax policy, and the analysis of tax policy, from the Great Recession. What did we get wrong? What did we underestimate the importance of? What do we need to think more about?

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