Rice University

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Thesis Defense

Graduate and Postdoctoral Studies
Economics

Speaker: Victor Del Carpio Neyra
Doctoral Candidate

A New Search-and-Matching Computable General Equilibrium Model: Progressive Consumption Taxation and Unemployment Equilibrium Effects on Growth, Unemployment, and Incidence

Monday, April 17, 2017
3:15 PM  to 6:00 PM

102  Baker Hall


I simulate the effects of the enactment of two comprehensive consumption-based tax reforms in the United States - a Hall-Rabushka style flat tax, and the Bradford X-tax. My analysis includes a search and matching model for unemployment in the labor market with endogenous wage bargaining. I examine the long-run economic effects of these reforms, including those in the labor market, as well as the distributional effects on twelve different income groups. In this context, a reform-induced wage reduction that reduces the incentive to work could nevertheless create jobs. However, it may also affect disproportionately the welfare of lower-income groups.

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