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dc.contributor.authorChetty, Raj
dc.contributor.authorLooney, Adam
dc.contributor.authorKroft, Kory
dc.date.accessioned2012-10-16T14:36:26Z
dc.date.issued2009
dc.identifier.citationChetty, Raj, Adam Looney, and Kory Kroft. 2009. Salience and taxation: theory and evidence. American Economic Review 99(4): 1145–1177.en_US
dc.identifier.issn0002-8282en_US
dc.identifier.urihttp://nrs.harvard.edu/urn-3:HUL.InstRepos:9748525
dc.description.abstractUsing 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.en_US
dc.description.sponsorshipEconomicsen_US
dc.language.isoen_USen_US
dc.publisherThe American Economic Associationen_US
dc.relation.isversionofdoi:10.1257/aer.99.4.1145en_US
dc.relation.hasversionhttp://www.nber.org/papers/w13330en_US
dc.relation.hasversionhttp://www.economics.harvard.edu/app/webroot/files/faculty/1238_taxsalience_nber.pdfen_US
dash.licenseOAP
dc.subjecteconomicsen_US
dc.subjectelasticityen_US
dc.subjectincomeen_US
dc.titleSalience and Taxation: Theory and Evidenceen_US
dc.typeJournal Articleen_US
dc.description.versionAuthor's Originalen_US
dc.relation.journalAmerican Economic Reviewen_US
dash.depositing.authorChetty, Raj
dc.date.available2012-10-16T14:36:26Z
dc.identifier.doi10.1257/aer.99.4.1145*
dash.contributor.affiliatedChetty, Raj


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