NoCeT having great publication success
Several of the researchers at the Norwegian Centre for Taxation have published in top ranked journals in 2017. Last in the series of top articles is forthcoming in Econometrica.
The article «Identifying and Estimating Supply and Demand Elasticities Using Exogenous Variation in a Single Tax Rate» is forthcoming in Econometrica. The journal is included on the NHH Bonus list. Researchers at NHH who publish in these journals receive a publication bonus of NOK 80 000.
The Econometrica article is by Floris Zoutman and Evelina Gavrilova-Zoutman, both assistant professors, and Associated Professor Arnt Ove Hopland, all at the Department of Business and Management Science and Norwegian Centre for Taxation.
Most models of taxation since F. P. Ramsey («A Contribution to the Theory of Taxation», 1927) assume that a tax levied on the demand side only affects demand through the price after taxation. Econometrically, we show that this assumption acts as an exclusion restriction. Under the Ramsey Exclusion Restriction (RER) a single tax reform can serve to simultaneously identify the demand and supply elasticity. The researchers develop an estimation method, which includes 2SLS estimators for the elasticities, and a test for strength of the instrument. We discuss possible applications.