Working Paper: NBER ID: w9308
Authors: Matthew D. Shapiro; Joel Slemrod
Abstract: In 2001, many households received rebate checks as advanced payments of the benefit of the new, 10 percent federal income tax bracket. A survey conducted at the time the rebates were mailed finds that few households said that the rebate led them mostly to increase spending. A follow-up survey in 2002, as well as a similar survey conducted after the attacks of 9/11, also indicates low spending rates. This paper investigates the robustness of these survey responses and assesses whether such surveys are useful for policy evaluation. It also draws lessons from the surveys for macroeconomic analysis of the tax rebate.
Keywords: tax rebate; consumer spending; macroeconomic policy; surveys
JEL Codes: E21; H31
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| 2001 tax rebate (H20) | consumer spending (D12) |
| low-income households (R20) | spending rate (H72) |
| aggregate economic conditions (E10) | spending rate (H72) |
| 2001 tax rebate (H20) | aggregate demand (E00) |
| 2001 tax rebate (H20) | short-run stimulus to the economy (E65) |