Publications

Peer-Reviewed Publications

Mobility Responses to the Establishment of a Residential Tax Haven: Evidence From Switzerland

Former title: "Beggar-Thy-Neighbour Tax Cuts: Mobility after a Local Income and Wealth Tax Reform in Switzerland"
Journal of Urban Economics, 129, 103441 (May 2022). pdfCEPR Discussion Paper No. 16627 (updated April 2022).Replication files: code, README
Abstract: I analyze mobility responses to a tax reform that established the Swiss canton of Obwalden as a tax haven in 2006. The reform, which included a regressive income tax schedule, was explicitly aimed at attracting the top 1%. Difference-in-Differences (DiD) estimations comparing Obwalden to all other cantons confirm that the reform successfully attracted high-income taxpayers: by 2016, the share of top earners in the canton had doubled, and average income per taxpayer was 16% higher relative to 2005. Based on individual tax return data, I estimate the mobility elasticity with a two-stage least squares (2SLS) approach, which isolates the identifying variation in the tax rate stemming from the 2006 reform only. I find a large elasticity of the stock of high-income taxpayers of 1.5–2 with respect to the net-of- average-tax rate. The corresponding flow elasticity is 7.2. Despite these large behavioral responses, the reform did not increase revenue per capita in the canton. Finally, I find small positive effects on local employment. However, in-movers with high incomes were not more likely to also work in the canton, and I cannot rule out that employment effects were driven by the simultaneous reduction in corporate income taxes.

Constructing Daily Economic Sentiment Indices Based on Google Trends

Joint with Vera Eichenauer, Ronald Indergand, and Christoph Sax.
Economic Inquiry, Vol 60(2) (April 2022), pp.694-705.Accompanying R-package: trendecon. Project website: trendecon.org. For a summary (in German) see Ökonomenstimme column. KOF Working Paper No. 484 (June 2020).
Abstract: Google Trends have become a popular data source for social science research. We show that for small countries or sub-national regions like U.S. states, underlying sampling noise in Google Trends can be substantial. The data may therefore be unreliable for time series analysis and is furthermore frequency-inconsistent: daily data diers from weekly or monthly data. We provide a novel sampling technique along with the R-package trendecon in order to generate stable daily Google search results that are consistent with weekly and monthly queries of Google Trends. We use this new approach to construct long and consistent daily economic indices for the (mainly) German-speaking countries Germany, Austria, and Switzerland. The resulting indices are significantly correlated with traditional leading indicators, with the advantage that they are available much earlier.

Intertemporal Labor Supply Substitution? Evidence from the Swiss Tax Holidays

Joint with Emmanuel Saez and Michael Siegenthaler.
American Economic Review, Vol. 111(2) (February 2021), pp. 506-546. pdfNBER Working Paper No. 24634 (revised July 2020), slides, and VoxEU and Ökonomenstimme columns.Replication files.
Abstract: This paper estimates intertemporal labor supply responses to two-year long income tax holidays staggered across cantons in Switzerland. Swiss cantons shifted from an income tax system based on the previous two years' income to a standard annual pay as you earn system, leaving 2 years of income untaxed. We find significant but quantitatively small responses of earnings with an inter-temporal elasticity of .05 overall. Some groups, such as high wage income earners and especially the self-employed display larger responses with elasticities around .1 and .2 respectively. We find no effects along the extensive margin at all and almost no effects on hours of work suggesting that responses are driven primarily by tax avoidance rather than real labor supply.

Volatile Top Income Shares in Switzerland? Reassessing the Evolution Between 1981 and 2010

Joint with Reto Föllmi.
The Review of Economics and Statistics, Vol. 99(5) (December 2017), pp. 793-809. pdfReplication files.
Abstract: In the last 20 years, the share of top incomes in Switzerland has risen, while exhibiting large variations. Switzerland is similar to European countries for the top1% but closer to the U.S. for higher top income groups. With the synthetic control method we close a time gap in the tax data, exploiting the fact that Swiss cantons changed their tax system at different points in time. Using social security data which cover all top labor incomes, we document the growing importance of labor compared to capital incomes among top income earners in Switzerland.
Data are available on WID.world (Updated until 2014). Here you can find the Online Appendix Tables, a PDF of the paper, a voxEU Column and an article written for Republik Magazin. The paper was covered in several media outlets, including, NZZ am Sonntag (here, here, and here), Die Volkswirtschaft, Handelszeitung, Le Temps, and Blick.



Book Chapters

Evidence from Unique Swiss Tax Data on the Composition and Joint Distribution of Income and Wealth


Draft (March 2021)
Chapter in forthcoming NBER book Measuring Distribution and Mobility of Income and Wealth, Raj Chetty, John N. Friedman, Janet C. Gornick, Barry Johnson, and Arthur Kennickell, editors. Conference held March 5-6, 2020. Forthcoming from University of Chicago Press.
Abstract: I compose a unique, new data set using individual income and wealth tax data from eight Swiss cantons. I describe the data in detail and show that it is representative for Switzerland as a whole. Next, I present a set of empirical facts regarding the distribution of wealth and income in Switzerland. I shed light on the composition of wealth and income along the distribution, including the very top. I find substantial heterogeneity in the composition for different population groups. Real estate wealth is held only by the upper half of the wealth distribution. Most importantly, due to the strong age-wealth gradient, age has an important influence on the composition as well as on the joint distribution of income and wealth. At any income level except for the bottom quintile, retirees are more likely to be higher up in the wealth distribution than non-retirees—including at the very top of the wealth distribution. Overall, I find a strong correlation between income and wealth, combine with a pronounced tail dependence, especially at the top. Taking age into account, gender differences in wealth levels are small. They are more pronounced in the income distribution, where women also rely more on transfer income than on labor income compared to men.

"Verteilung, Bildung und die Chancen des sozialen Aufstiegs"


in: Denknetz Jahrbuch 2018. Bildung und Emanzipation. Zürich: edition 8, September 2018.



Non-Reviewed Publications

Corona und Ungleichheit in der Schweiz - Eine erste Analyse der Verteilungswirkungen der Covid-19-Pandemie

Joint with Daniel Kopp, Rafael Lalive, Stefan Pichler, and Michael Siegenthaler.
KOF Studien, Nr. 161 (February 2021)
Featured, among others, in SRF Eco (TV-Interview here and here), Le Temps, Tagesanzeiger, Handelszeitung, Finanz und Wirtschft, Blick.


Inequality in Switzerland: A Haven of Stability?

Joint with Reto Föllmi. pdf
CESifo Forum, 2/2018 (Summer 2018), pp. 19-25.


Die Verteilung von Einkommen und Vermögen in der Schweiz

Joint with Reto Föllmi. pdf
UBS International Center of Economics in Society Public Paper, No. 6 (November 2017)


Die Topeinkommen in der Schweiz seit 1980: Verteilung und Mobilität.


Social Change in Switzerland, Nr.11 (November 2017).


Cantonal Differences in Health Care Premium Subsidies in Switzerland

Joint with Berit Gerritzen and Alma Ramsden.
University of St. Gallen SEPS Working Paper No.14-20 (July 2014).


Bookreview on: ‘Methods for Quantitative Macro-Comparative Research’ by Salvatore Babones


Journal of World-Systems Research, Vol. 20(1) (March 2014).


Mit Konjunkturstabilisierung längerfristige Wachstumschancen sichern

Joint with Daniel Lampart.
SGB-Dossier, Nr. 65 (June 2009).


Books

Mindestlöhne – Situation und Handlungsbedarf. Bericht der SGB-Expertengruppe Mindestlohn.


Joint with Daniel Lampart, Doris Bianchi and Gabriela Medici.
Zürich: Editions à la Carte, May 2011.

Link to my Google Scholar site.