Who Bears the Lifetime Tax Burden? Book

1	Introduction and Summary	1
	Two Approaches to Tax Incidence	1
	The Theory of Tax Incidence	7
	Empirical Work on Tax Incidence	11
	Comparing Annual and Lifetime Perspectives	17
	The Measure of Lifetime Income	21
	A Description of the Model	28
	A Summary of Results	35
2	Theoretical Basis of the Lifetime Incidence Model	44
	The Consumption Side	45
	The Production Side	51
	Government	55
	International Trade	57
	Treatment of Taxes	58
	Equilibrium Conditions and Computational Procedure	62
	Calculating Tax Incidence	65
3	Data Sources	68
	Model Dimensions	68
	Consumer Data	71
	Industry Data	76
	Government and Trade Data	87
4	Determination of Lifetime Incomes	92
	Data	95
	Initial Fixed-Effect Regressions	97
	Determination of Lifetime Incomes and Their Distribution	102
	Characteristics and Profiles by Lifetime Income Category	113
	Lifetime Distributional Effects of Government Programs	120
	Conclusion	124
5	Consumption Patterns by Age	126
	The Linear Expenditure System	127
	The Consumer Expenditure Survey	130
	Aggregation for Detailed Expenditures	132
	Corrections of Underreporting	136
	Econometric Procedure	136
	Parameters of the Linear Expenditure System	137
6	Calibrating Parameters and Adjusting the Data Set	142
	Obtaining a Consistent Data Set	143
	Calibration of Other Parameters	149
7	Simulations and Results	154
	Tax Parameters for Each Simulation	155
	The Benchmark as a Basis of Comparison	159
	Counterfactual Results Compared to the Benchmark	163
	Lifetime Tax Incidence under Standard Parameters	170
	The Uniform Consumption Tax Replacement	186
8	Sensitivity Analysis	193
	Utility Parameters	196
	Other Specifications	203
	What We Learn from Sensitivity Calculations	213
9	Evaluation of Policy Reforms	215
	The Tax Reform Act of 1986	215
	Corporate Tax Integration	223
	Value-Added Taxation	228
	References	233
	Index	241