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Corporate Tax Incidence: A Review of Empirical Estimates and Analysis: Working Paper 2011-01

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  • Jennifer C. Gravelle

Abstract

This paper reviews seven recent studies that have used empirical methods to examine the incidence of the corporate income tax. These regression-based studies follow three general approaches. The first group of studies uses the variation in corporate tax rates across countries to determine the effect of the tax on wages. A second group adopts the same approach, but uses the variation in corporate tax rates across U.S. states instead of focusing on cross-country differences. The third set of studies adopts wage bargaining models to analyze the effect of corporate taxes on

Suggested Citation

  • Jennifer C. Gravelle, 2011. "Corporate Tax Incidence: A Review of Empirical Estimates and Analysis: Working Paper 2011-01," Working Papers 41511, Congressional Budget Office.
    • Handle: RePEc:cbo:wpaper:41511
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    File URL: https://www.cbo.gov/sites/default/files/112th-congress-2011-2012/workingpaper/06-14-2011-corporatetaxincidence_1.pdf
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    References listed on IDEAS

    as
    1. Kevin A. Hassett & Aparna Mathur, 2006. "Taxes and Wages," AEI Economics Working Papers 49800, American Enterprise Institute.
    2. John Van Reenen, 1996. "The Creation and Capture of Rents: Wages and Innovation in a Panel of U. K. Companies," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 111(1), pages 195-226.
    3. Arnold C. Harberger, 1962. "The Incidence of the Corporation Income Tax," Journal of Political Economy, University of Chicago Press, vol. 70(3), pages 215-215.
    4. Alison Felix, 2007. "Passing the burden: corporate tax incidence in open economies," Regional Research Working Paper RRWP 07-01, Federal Reserve Bank of Kansas City.
    5. William C. Randolph, 2006. "International Burdens of the Corporate Income Tax: Working Paper 2006-09," Working Papers 18067, Congressional Budget Office.
    6. R. Alison Felix, 2007. "Passing the Burden: Corporate Tax Incidence in Open Economies," LIS Working papers 468, LIS Cross-National Data Center in Luxembourg.
    7. R. Alison Felix & James R. Hines, Jr., 2009. "Corporate Taxes and Union Wages in the United States," NBER Working Papers 15263, National Bureau of Economic Research, Inc.
    8. Alison Felix, 2009. "Do state corporate income taxes reduce wages?," Economic Review, Federal Reserve Bank of Kansas City, vol. 94(Q II), pages 77-102.
    9. Jennifer C. Gravelle, 2010. "Corporate Tax Incidence: Review of General Equilibrium Estimates and Analysis: Working Paper 2010-03," Working Papers 21486, Congressional Budget Office.
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    Cited by:

    1. Juan Carlos Suárez Serrato & Owen Zidar, 2016. "Who Benefits from State Corporate Tax Cuts? A Local Labor Markets Approach with Heterogeneous Firms," American Economic Review, American Economic Association, vol. 106(9), pages 2582-2624, September.
    2. Masud Alam, 2021. "Heterogeneous Responses to the U.S. Narrative Tax Changes: Evidence from the U.S. States," Papers 2107.13678, arXiv.org.
    3. Mr. Nigel A Chalk & Mr. Michael Keen & Ms. Victoria J Perry, 2018. "The Tax Cuts and Jobs Act: An Appraisal," IMF Working Papers 2018/185, International Monetary Fund.
    4. Li, Bing & Liu, Chang & Sun, Stephen Teng, 2021. "Do corporate income tax cuts decrease labor share? Regression discontinuity evidence from China," Journal of Development Economics, Elsevier, vol. 150(C).

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