NĚMEC, Daniel, Vlastimil REICHEL, Jakub CHALMOVIANSKÝ and Jana BALÁŽOVÁ. Estimating the Laffer Curve for Slovakia: A DSGE Approach. In Michal Houda, Radim Remeš. Proceedings of 37th International Conference on Mathematical Methods in Economics. České Budějovice: University of South Bohemia in České Budějovice, 2019. p. 297-303. ISBN 978-80-7394-760-6.
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Basic information
Original name Estimating the Laffer Curve for Slovakia: A DSGE Approach
Authors NĚMEC, Daniel (203 Czech Republic, guarantor, belonging to the institution), Vlastimil REICHEL (203 Czech Republic, belonging to the institution), Jakub CHALMOVIANSKÝ (703 Slovakia, belonging to the institution) and Jana BALÁŽOVÁ (703 Slovakia).
Edition České Budějovice, Proceedings of 37th International Conference on Mathematical Methods in Economics, p. 297-303, 7 pp. 2019.
Publisher University of South Bohemia in České Budějovice
Other information
Original language English
Type of outcome Proceedings paper
Field of Study 50202 Applied Economics, Econometrics
Country of publisher Czech Republic
Confidentiality degree is not subject to a state or trade secret
Publication form electronic version available online
WWW Conference proceedings
RIV identification code RIV/00216224:14560/19:00110683
Organization unit Faculty of Economics and Administration
ISBN 978-80-7394-760-6
Keywords in English underground economy; DSGE model; tax system; Laffer curve; Slovakia
Tags International impact, Reviewed
Changed by Changed by: Ing. Mgr. Vlastimil Reichel, Ph.D., učo 357467. Changed: 1/8/2022 13:31.
Abstract
The goal of this paper is to quantify the impact of alternative tax adjustments on government tax revenues and the size of the shadow economy in Slovakia. Our approach uses a small dynamic stochastic general equilibrium (DSGE) model consisting of both formal and informal sectors of the economy. Using the quarterly data for the Slovak economy from 2000 to 2017 we estimate a linearised form of the DSGE model. Based on our parameter estimates, we perform a set of simulations using the non-linear form of the underlying DSGE model to evaluate the effects of changes in the corporate tax rate, personal income tax rate, social security tax rate, and in the probability of tax control. These effects are evaluated with regards to the changes in steady-state values of the output in the official economy, total tax revenues, and the size of the shadow economy. The corresponding Laffer curves show strong responses in the size of the underground economy when the corporate tax rates or personal income tax rates are growing. On the other hand, the increase of the social security tax rates causes only small growth in the share of the shadow economy without negative effects on government tax revenues.
Links
MUNI/A/0972/2018, interní kód MUName: Dynamické modelování strukturálních změn trhu práce a trhu s nemovitostmi v průběhu hospodářského cyklu
Investor: Masaryk University, Category A
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