Replication data for: Salience and Taxation: Theory and Evidence

Principal Investigator(s): View help for Principal Investigator(s) Raj Chetty; Adam Looney; Kory Kroft

Name	File Type	Size	Last Modified
LICENSE.txt	text/plain	14.6 KB	10/12/2019 05:39:AM
README.pdf	application/pdf	17.7 KB	10/12/2019 05:39:AM
alcohol_analysis.do	text/plain	5.3 KB	10/12/2019 05:39:AM
alcohol_data.dta	application/octet-stream	148.5 KB	10/12/2019 05:39:AM
collapsed_grocery_data.dta	application/octet-stream	5.9 KB	10/12/2019 05:39:AM
grocery_dataprep.do	text/plain	6.7 KB	10/12/2019 05:39:AM
grocery_placebo.do	text/plain	1.4 KB	10/12/2019 05:39:AM
grocery_regressions.do	text/plain	4 KB	10/12/2019 05:39:AM
raw_grocery_data.dta	application/octet-stream	2.4 KB	10/12/2019 05:39:AM
survey_data.xls	application/vnd.ms-excel	74 KB	10/12/2019 05:39:AM

Project Citation:

Chetty, Raj, Looney, Adam, and Kroft, Kory. Replication data for: Salience and Taxation: Theory and Evidence. Nashville, TN: American Economic Association [publisher], 2009. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-12. https://doi.org/10.3886/E113312V1

Project Description

Summary: Using two strategies, we show that consumers underreact to taxes that are not salient. First, using a field experiment in a grocery store, we find that posting tax-inclusive price tags reduces demand by 8 percent. Second, increases in taxes included in posted prices reduce alcohol consumption more than increases in taxes applied at the register. We develop a theoretical framework for applied welfare analysis that accommodates salience effects and other optimization failures. The simple formulas we derive imply that the economic incidence of a tax depends on its statutory incidence, and that even policies that induce no change in behavior can create efficiency losses. (JEL C93, D12, H25, H71)

Scope of Project

JEL Classification:
      C93 Field Experiments
      D12 Consumer Economics: Empirical Analysis
      H25 Business Taxes and Subsidies including sales and value-added (VAT)
      H71 State and Local Taxation, Subsidies, and Revenue

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Published Versions

V1 [2019-10-12]

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DDI 2.5

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