Camille Landais - Personal page

Research

PAPERS & PUBLICATIONS:

NEW « Taxing Top Wealth: Migration Responses and their Aggregate Economic Implications »
with Katrine Jakobsen, Henrik Kleven, Jonas Kolsrud & Mathilde Munoz
[Slides] [Abstract]
Abstract: Do wealth taxes lead to a harmful exodus of wealthy taxpayers? Using administrative data on wealth, firm ownership structure, and migration in Sweden and Denmark, we estimate international migration responses to wealth taxation and evaluate the aggregate economic implications of tax-induced migration. Exploiting three large reforms, we find significant migration responses to wealth taxes among the wealthy. We then investigate individual-level, firm-level, and market-level effects of these migration responses. A large fraction of wealthy taxpayers are business owners, and the employment, investments, and value-added of these businesses are negatively affected by owner out-migration. Nevertheless, the aggregate consequences of these effects are modest. We estimate that migration responses to a 1pp increase in the top wealth tax rate decrease the stock of wealthy taxpayers by less than 2% in the long run, and lead to a reduction of 0.05% in aggregate employment, 0.07% in aggregate investment, and 0.13% in aggregate value-added. Hence, our results demonstrate that trickle-down effects of tax-induced migration by the wealthy do exist, but that they are quantitatively small

NEW « The Child Penalty Atlas »
with Henrik Kleven & Gabriel Leite-Mariante
Forthcoming Review of Economic Studies
[Website] [The Economist - Graphic Detail] [NBER Digest] [Slides] [Abstract]
Abstract: This paper builds a world atlas of child penalties in employment based on micro data from 134 countries. The estimation of child penalties is based on pseudo-event studies of first child birth using cross-sectional data. The pseudo-event studies are validated against true event studies using panel data for a subset of countries. Most countries display clear and sizable child penalties: men and women follow parallel trends before parenthood, but diverge sharply and persistently after parenthood. While this pattern is pervasive, there is enormous variation in the magnitude of the effects across different regions of the world. The fraction of gender inequality explained by child penalties varies systematically with economic development and proxies for structural transformation. At low levels of development, child penalties represent a minuscule fraction of gender inequality. But as economies develop — incomes rise and the la- bor market transitions from subsistence agriculture to salaried work in industry and services — child penalties take over as the dominant driver of gender inequality. The relationship between child penalties and development is validated using historical data from current high-income countries, back to the 1700s for some countries. Finally, because parenthood is often tied to marriage, we also investigate the existence of marriage penalties in female employment. In general, women experience both marriage and child penalties, but their relative importance de- pends on the level of development. The development process is associated with a substitution from marriage penalties to child penalties, with the former gradually converging to zero.

REVISED « Wealth and Property Taxation in the United States »
with Sacha Dray & Stefanie Stantcheva
Revisions requested Quarterly Journal of Economics
[Slides] [Abstract]
Abstract: We study the history and geography of wealth accumulation in the US, using newly collected historical property tax records since the early 1800s. The US General Property Tax was a comprehensive tax on all types of property (real, personal, and financial), making it one of the first “wealth taxes.” Drawing on many historical records, we construct long-run, consistent, high-frequency wealth series at the county, state, and national levels. We first document the long-term evolution of household wealth in the US since the early 1800s. The US experienced extraordinary wealth accumulation after the Civil war and until the Great Depression. Second, we reveal that spatial inequality in the US has been large and highly persistent since the mid-1800s, driven mainly by Southern states, whose long-run divergence from the rest of the US predated the Civil War. Before the Civil war, enslaved people were assessed as personal property of the enslavers, representing almost one-half of total taxable property in Southern states. This system is morally abhorrent and implies wrongly counting forced labor income as capital. The regional distribution of wealth and the effects of the Civil war appear very different if enslaved people are not included in the property measure. Third, we investigate the determinants of long-term wealth growth and capital accumulation. Among others, we find that counties with a higher share of enslaved property before the Civil War or higher levels of wealth inequality experienced lower subsequent long-run growth in property.

« Retirement Consumption & Pension Design »
with Jonas Kolsrud, Daniel Reck Dray & Johannes Spinnewijn
American Economic Review 114.1: 89-133, 2024
[Slides] [Video] [Abstract]
Abstract: This paper analyzes consumption to evaluate the distributional effects of pension re- forms. Using Swedish administrative data, we show that on average workers who retire earlier consume less while retired and experience larger drops in consumption around retirement. Interpreted via a theoretical model, these findings imply that reforms incentivizing later retirement incur a substantial consumption-smoothing cost. Turning to other features of pension policy, we find that reforms that redistribute based on early-career labor supply would have opposite-signed redistributive effects, while differentiating on wealth may help to target pension benefits toward those who are vulnerable to larger drops in consumption around retirement.

« Do Family Policies Reduce Gender Inequality? Evidence from 60 Years of Policy Experimentation »
with Henrik Kleven, Johanna Posch, Andreas Steinhauer & Josef Zweimuller
American Economic Journal: Economic Policy 16.2: 110-49, 2024.
[Abstract] [Slides]
Abstract: Do family policies reduce gender inequality in the labor market? We contribute to this debate by investigating the joint impact of parental leave and child care, using administrative data covering the labor market and birth histories of Austrian workers over more than half a century. We start by quasi-experimentally identifying the causal effects of all family policy reforms since the 1950s, including the introduction of maternal leave benefits in 1961, on the full dynamics of male and female earnings. We then use these causal estimates to compute gender inequality series for counterfactual scenarios regarding the evolution of family policies. Our results show that the enormous expansions of parental leave and child care subsidies have had virtually no impact on gender convergence.

« Subsidizing Labor Hoarding in Recessions: The Employment & Welfare Effects of Short Time Work »
with Giulia Giupponi
Review of Economic Studies Volume 90, Issue 4: 1963–2005, 2023
[Abstract]
Abstract: Short time work (STW) policies provide subsidies for hour reductions to workers in firms experiencing temporary shocks. They are the main policy tool used to support labor hoarding during downturns, and have been used aggressively since the start of the COVID-19 pandemic. Yet, very little is known about their employment and welfare consequences. This paper leverages unique administrative social security data from Italy during the Great Recession and quasi-experimental variation in STW policy rules to offer evidence of the effects of STW on firms’ and workers’ outcomes. Our results show large and significant negative effects of STW treatment on hours, but large and positive effects on headcount employment. We then analyze whether these positive employment effects are welfare enhancing, distinguishing between temporary and more persistent shocks. We first provide evidence that liquidity constraints and bargaining frictions make labor hoarding inefficiently low absent STW. Then, we show that adverse selection of low productivity firms into STW creates significant negative reallocation effects when the shock is persistent.
[Online Appendix] [Slides] [VOX-EU Summary for Broader Public] [VOX-Talks Podcast]
[Building Effective STW in COVID Crisis]

« Should We Insure Workers or Jobs During Recession? »
with Giulia Giupponi, & Alice Lapeyre
Journal of Economic Perspectives, Vol. 36, n. 2, pp. 29-54, Spring 2022
[Online Appendix] [Slides] [Working Paper Version] [Abstract]
Abstract: What is the most efficient way to respond to recessions in the labor market? To this question, policymakers on both sides of the pond gave two diametrically opposed answers during the recent crisis. In the US, the focus was on insuring workers, by aggressively increasing the generosity of unemployment insurance. In Europe, to the contrary, policies were concentrated on saving job matches, with the massive use of labor hoarding subsidies through short-time work programs, on which so little is actually known. So who got it right? Should we insure workers or jobs during recessions? In this article, we show that far from being substitutes, unemployment insurance and short-time-work policies exhibit strong complementarities. They provide insurance to different types of workers, and against different types of shocks. Short-time-work can be an effective way to reduce socially costly layoffs against large temporary shocks but is less effective against more persistent shocks that require reallocation across firms and sectors. Overall, we conclude that short-time-work is an important and useful addition to the labor market policy-toolkit during recessions, which should be used alongside unemployment insurance.

« Women & Men At Work »
with Alison Andrew, Oriana Bandiera & Monica Costa-Dias
Published as part of the IFS Deaton Review of Inequalities, December 2021
[Executive Summary] [Abstract]
Abstract: This chapter is concerned with the differences between men and women in all activities that can be labelled as ‘work’ – that is, the time and energy that people devote to producing things of value. Work thus encompasses the production of market goods and service as well as the time spent doing household chores, childcare or care of the elderly. Data from the UK and other high-income countries reveal a sharp, if unsurprising, divide: men do more paid work outside the house, women do more unpaid work inside. Moreover, when doing paid work, women are paid less. This pattern has remained stable in the past quarter of a century. Gender differences in the sharing of unpaid work – including the sharing of childcare, other care work, and housework – shape much of the unequal outcomes we see in the labour market; a deeply uneven division of unpaid work makes it hard to achieve equal outcomes in paid work. Do these differences in labour market outcomes between men and women matter? In this chapter, we explore their many consequences and contend that there are several important reasons why they do: gender disparities in the amount of work individuals do, the types of work they do, and the rewards they get for doing that work are all central determinants of broader gender inequalities in social status, well-being and poverty. First off, work (both paid and unpaid) can be intrinsically important for well-being and life satisfaction. Second, different types of work bring different extrinsic rewards. Particularly important here is the distinction between paid and unpaid work. While unpaid work, such as housework and care work, is crucial for the functioning of the economy and society, the fact that it does not bring monetary rewards can leave people who do not work for pay vulnerable to economic hardship and poverty. This is the case both in the short and longer run, if the absence of paid work in the present reduces work opportunities and earnings in the future. Inequalities in paid work may also translate into broader inequalities in well-being if individual contributions to family income bring with them influence in important family decisions, reflecting how paid work can be directly connected to agency and autonomy. At the level of the whole economy, gender inequalities may hamper aggregate efficiency and reduce the overall quantity of the goods and services (both market and non-market) produced. The amount of output that an economy can produce for a given level of resources is largest when the skills and talents of individuals are allocated to the activities where their return is largest. If women face higher barriers to participating in paid work (or, similarly, men face higher barriers to participating in domestic and care work), this will result in women’s (respectively men’s) talents not being put to their best use and will reduce overall efficiency. A corollary here is that such inefficiencies will reduce government tax revenue, which is an important point since it implies that even costly policies that succeed in putting women’s and men’s talents to better use in the labour market may ultimately pay for themselves.

« Choice in Insurance Markets: A Pigouvian Approach to Social Insurance Design »
with Nathan Hendren & Johannes Spinnewijn
Annual Review of Economics vol.13: 457-86, 2021
[Abstract]
Abstract: Should choice be offered in social insurance programs? The paper presents a conceptual framework that identifies the key forces determining the value of offering choice, reviews some existing evidence on these forces, and aims to guide further empirical research in different insurance domains. The value of offering choice is higher the larger the variation in individual valuations, but gets reduced by both selection on risk and selection on moral hazard. The implementation of choice-based policies is further challenged by the presence of adverse selection and choice frictions or the obligation to offer basic uncompensated care. These inefficiencies can be seen as externalities, which do not rationalize the absence of providing choice per se, but point to the need for regulatory policies and the potential value of corrective pricing à la Pigou

« Does Biology Drive Child Penalties? Evidence from Biological and Adoptive Families »
with Henrik Kleven & Jakob Sogaard
American Economic Review: Insights , 3, 183-198, 2021.
[Abstract]
Abstract: This paper investigates if the impact of children on the labor market trajectories of women relative to men — child penalties — can be explained by the biological links between mother and child. We estimate child penalties in biological and adoptive families using event studies around the arrival of children and almost forty years of adoption data from Denmark. Long-run child penalties in earnings and its underlying determinants are virtually identical in biological and adoptive families. This implies that biology is not important for child-related gender gaps. Based on additional anal- yses, we argue that our results speak against the importance of specialization based on comparative advantage more broadly.

« Risk-based Selection in Unemployment Insurance: Evidence and Implications »
with A. Nekoei, Peter Nilsson, David Seim, & Johannes Spinnewijn
American Economic Review Vol. 111, No. 4, April 2021
Recipient of the Sveriges a-kassor Best paper Prize 2021
[Abstract]
Abstract: This paper studies whether adverse selection can rationalize a universal mandate for unemployment insurance (UI). To date no direct evidence exists in the UI context and the desirability of a UI mandate has been untested. Building on the unique institutional setting of Sweden, where workers can buy supplemental UI coverage above a minimum mandate, we provide the first direct evidence for adverse selection in UI and derive its implications for UI design. We find that workers who buy the supplemental coverage face higher unemployment risk (with semi-elasticities above 1), even after controlling for a rich set of observables. Exploiting unique variation in risk and in prices to control for moral hazard, we show how this correlation is driven by substantial risk-based selection. Despite the severe adverse selection, we find that allowing for choice welfare-dominates mandating the supplemental coverage. We also show that a large subsidy for supplemental coverage is optimal and complementary to the minimum mandate.
[Slides] [VOX-EU Summary for Broader Public]

« The Value Of Unemployment Insurance »
with Johannes Spinnewijn
Review of Economic Studies Volume 88, Issue 6, Pages 3041–3085, November 2021.
[Slides] [Online Appendix] [Abstract]
Abstract: Due to the absence of unemployment insurance (UI) choices, the traditional approach to estimating the value of UI is to infer it from the observed consumption response to job loss under some assumption on risk preferences. Exploiting the rich data and unique policy context in Sweden, we propose two alternative approaches that relax this assumption and we implement all three methods on the same sample of workers. The first approach considers the difference in marginal propensity to consume (MPC) when unemployed vs. employed, which allows to identify the difference in prices to smooth consumption in the respective states. The second approach exploits UI choices embedded in the Swedish UI system in a Revealed Preference approach. While the drop in consumption expenditures is relatively small (∼ 13 percent), we find that the MPC is around 25 percent higher when unemployed than employed, translating into a marginal value of transfers that is at least 60 percent higher when unemployed than employed. This high value of UI is confirmed by our RP estimates and indicates substantial risk aversion given the relatively small drop in consumption expenditures.

« Consumption Dynamics in the COVID Crisis: Real Time Insights from French Data »
with David Bounie, Youssouf Camara, Etienne Fize, John Galbraith, Chloe Lavest, Tatiana Pazem & Baptiste Savatier
Covid Economics Vol.59, November 2020
[Abstract]
Abstract: We use anonymised transaction and bank data from France to document the evolution of consumption and savings dynamics since the onset of the pandemic. We find that consumption has dropped very severely during the nation-wide lock- down but experienced a strong and steady rebound during the Summer, before faltering in late September. This drop in consumption with met with a significant increase in aggregate households' net financial wealth. This excess savings is extremely heterogenous across the income distribution: 50% of excess wealth accrued to the top decile. Households in the bottom decile of the income distribution experienced a severe decrease in consumption, a decrease in savings and an increase in debt. We estimate marginal propensities to consume and show that their magnitude is large, especially at the bottom of the income and liquidity distributions.

« Taxation and Migration: Evidence and Policy Implications »
with Henrik Kleven, Mathilde Munoz and Stefanie Stantcheva
Journal of Economic Perspectives , 34 (2): 119-142, 2020.
[Abstract]
Abstract: In this article, we review a growing empirical literature on the effects of personal taxation on the geographic mobility of people and discuss its policy implications. We start by laying out the empirical challenges that prevented progress in this area until recently, and then discuss how recent work have made use of new data sources and quasi-experimental approaches to credibly estimate migration responses. This body of work has shown that certain segments of the labor market, especially high-income workers and professions with little location-specific human capital, may be quite responsive to taxes in their location decisions. When considering the implications for tax policy design, we distinguish between uncoordinated and coordinated tax policy. We highlight the importance of recognizing that mobility elasticities are not exogenous, structural parameters. They can vary greatly depending on the population being analyzed, the size of the tax jurisdiction, the extent of tax policy coordination, and a range of non-tax policies. While migration responses add to the efficiency costs of redistributing income, we caution against over-using the recent evidence of (sizeable) mobility responses to taxes as an argument for less redistribution in a globalized world.

« The Value of Registry Data for Consumption Analysis: An Application to Health Shocks »
with Jonas Kolrsud & Johannes Spinnewijn
Journal of Public Economics Volume 189, 2020.
[Abstract]
Abstract: This paper measures consumption expenditures using registry data on income and asset holdings in Sweden. We show how a registry-based measure complements traditional survey measures of consumption and can alleviate some critical limitations. We describe the construction of our measure, which builds on prior work and exploits the identity coming from the household budget constraint between consumption expenditures and income net of savings. We demonstrate the value of the registry-based measure to study consumption responses to shocks, also relative to surveyed consumption. In our application to health shocks, we find that Swedish household experience permanent earning drops, but generous social transfers provide substantial consumption smoothing. We document important heterogeneity in consumption responses and the limited role for private means.
[Paper] [Programs & Documentation - The Consumption Project] [VOX-EU Summary for Broader Public]

« Child Penalties Across Countries: Evidence and Explanations »
with Henrik Kleven, Johanna Posch, Andreas Steinhauer, and Josef Zweimuller
AEA Papers & Proceedings 109: 122-126, 2019
[Programs & Documentation] [Abstract]
Abstract: This paper provides evidence on child penalties in female and male earnings in different countries. The estimates are based on event studies around the birth of the first child, using the specification proposed by Kleven et al. (2018). The analysis reveals some striking similarities in the qualitative effects of children across countries, but also sharp differences in the magnitude of the effects. We discuss the potential role of family policies (parental leave and child care provision) and gender norms in explaining the observed differences.

« Children and Gender Inequality: Evidence from Denmark »
with Henrik Kleven & Jakob Sogaard
American Economic Journal: Applied Economics 11 (4): 181-209, 2019
Recipient of the AEJ Best Paper Award 2020
[Abstract] [VOX-EU Summary for Broader Public] [Press Coverage] [Watch Netflix Documentary]
Abstract: Despite considerable gender convergence over time, substantial gender inequality persists in all countries. Using Danish administrative data from 1980-2013 and an event study approach, we show that most of the remaining gender inequality in earnings is due to children. The arrival of children creates a gender gap in earnings of around 20% in the long run, driven in roughly equal proportions by labor force participation, hours of work, and wage rates. Underlying these ''child penalties'', we find clear dynamic impacts on occupation, promotion to manager, sector, and the family friendliness of the firm for women relative to men. Based on a dynamic decomposition framework, we show that the fraction of gender inequality caused by child penalties has increased dramatically over time, from about 40% in 1980 to about 80% in 2013. As a possible explanation for the persistence of child penalties, we show that they are transmitted through generations, from parents to daughters (but not sons), consistent with an influence of childhood environment in the formation of women's preferences over family and career.

« The Optimal Timing of Unemployment Benefits: Theory and Evidence from Sweden »
with Jonas Kolsrud, Peter Nilsson and Johannes Spinnewijn
American Economic Review 108 (4-5): 985-1033, 2018
[Abstract] [Online Appendix] [Slides] [MicroEconomic Insight for Broader Public]
Abstract: This paper provides a simple, yet robust framework to evaluate the time profile of benefits paid during an unemployment spell. We derive sufficient-statistics formulae capturing the marginal insurance value and incentive costs of unemployment benefits paid at different times during a spell. Our approach allows us to revisit separate arguments for inclining or declining profiles put forward in the theoretical literature and to identify welfare-improving changes in the benefit profile that account for all relevant arguments jointly. For the empirical implementation, we use administrative data on unemployment, linked to data on consumption, income and wealth in Sweden. First, we exploit duration-dependent kinks in the replacement rate and find that, if anything, the moral hazard cost of benefits is larger when paid earlier in the spell. Second, we find that the drop in consumption affecting the insurance value of benefits is large from the start of the spell, but further increases throughout the spell. In trading off insurance and incentives, our analysis suggests that the flat benefit profile in Sweden has been too generous overall. However, both from the insurance and the incentives side, we find no evidence to support the recent introduction of a declining tilt in the profile.

« A Macroeconomic Approach to Optimal Unemployment Insurance I: Theory »
with Pascal Michaillat & Emmanuel Saez
American Economic Journal: Economic Policy 10(2): 152-181, 2018
[Abstract] [Slides] [Press Coverage]
Abstract: This paper develops a theory of optimal unemployment insurance (UI) in matching models. The optimal replacement rate is the conventional Baily-Chetty replacement rate, which solves the tradeoff between insurance and job-search incentives, plus a correction term, which is positive when an increase in UI pushes labor market tightness toward its efficient level. Labor market tightness is generally inefficient because in matching models, most wage mechanisms do not ensure efficiency. The effect of UI on tightness depends on the model: UI may raise tightness by alleviating a rat race for jobs or lower tightness by increasing wages through bargaining.

[WSJ Blog]

« A Macroeconomic Approach to Optimal Unemployment Insurance II: Applications »
with Pascal Michaillat & Emmanuel Saez
American Economic Journal: Economic Policy 10(2): 182-216, 2018
[Abstract] [Slides] [Press Coverage]
Abstract: In the United States, unemployment insurance (UI) is more generous when unemployment is high. This paper examines whether this policy is desirable. The optimal UI replacement rate is the Baily-Chetty replacement rate plus a correction term measuring the effect of UI on welfare through labor market tightness. Empirical evidence suggests that tightness is inefficiently low in slumps and inefficiently high in booms, and that an increase in UI raises tightness. Hence, the correction term is positive in slumps but negative in booms, and optimal UI is indeed countercyclical. Since there remains some uncertainty about the empirical evidence, the paper provides a thorough sensitivity analysis.

[WSJ Blog]

« Gender Inequality and Economic Development: Fertility, Education, and Norms »
with Henrik Kleven
Economica 84: 180-209, 2017.
[Abstract]
Abstract: In this paper we document the evolution of gender inequality in labor market outcomes ( earnings, labor supply, and wage rates) across levels of economic development, and discuss the main reasons for the observed patterns. To this end, we have created a micro database that compiles 248 surveys from 53 countries between 1967-2014, covering a wide range of per capita income levels. There is large convergence in the earnings of men and women across levels of development, driven by female labor force participation and wage rates. We argue that the single most important factor behind this covergence is demographic transition: the effects of children on gender gaps ("child penalties") are large at both low and high levels of development, but fertility declines drastically over the growth process and thus reduces the aggregate implications of children. We also document gender convergence in educational attainment and consider its effects on earnings inequality, which are significant but less dramatic than the effects of fertility. Finally, we document striking changes in the values or norms surrounding the role of women with children, arguing that such changes may serve as a reinforcing mechanism for gender convergence.

« The Effect of Tax Enforcement on Tax Elasticities: Evidence from Charitable Contributions in France »
with Gabrielle Fack
Journal of Public Economics, Volume 133, January 2016, Pages 23-40.
A previous version of the paper was circulated under the title « Charitable giving and tax policy in the presence of tax cheating: Theory and evidence from the US and France »
[Abstract] [Slides]
Abstract: Optimal tax formulas expressed in ``sufficient statistics'' are usually calibrated under the assumption that the relevant tax elasticities are unaffected by other available policy instruments. In practice though, tax authorities have many more instruments than the mere tax rates and tax elasticities are functions of all these policy instruments. In this paper we provide evidence that tax elasticities are extremely sensitive to a particular policy instrument: the level of tax enforcement. We exploit a natural experiment that took place in France in 1983, when the tax administration tightened the requirements to claim charitable deductions. The reform led to a substantial drop in the amount of contributions reported to the administration, which can be credibly attributed to overreporting of charitable contributions before the reform, rather than to a real change in giving behaviours. We show that the reform was also associated with a substantial decline in the absolute value of the elasticity of reported contributions. This finding allows us to partially identify the elasticity of overreporting contributions, which is shown to be large and inferior to -2 in the lax enforcement regime. We further show using bunching of taxpayers at kink-points of the tax schedule that the elasticity of taxable income also experienced a significant decline after the reform. Our results suggest that optimizing the tax rate for a given tax elasticity when other policy instruments are not optimized can lead to misleading conclusions when tax authorities have another instrument that could set the tax elasticity itself at its optimal level as in Kopczuck & Slemrod [2002]

« Market Externalities of Large Unemployment Insurance Extension Programs »
with Rafael Lalive & Josef Zweimuller
American Economic Review 105(12): 3564-3596, 2015.
[Abstract] [Slides] [Online Appendix] [Data & Programs] [VOX-EU Summary for Broader Public]
Abstract This paper offers quasi experimental evidence of the existence of spillover effects of UI extensions using a unique program that extended unemployment benefits drastically for a subset of workers in selected regions of Austria. We use non-eligible unemployed in treated regions, and a difference-in-difference identification strategy to control for preexisting differences across treated and untreated regions. We uncover the presence of important spillover effects: in treated regions, as the search effort of treated workers plummets, the job finding probability of untreated workers increases, and their average unemployment duration and probability of long term unemployment decrease. These effects are the largest when the program intensity reaches its highest level, then decrease and disappear as the program is scaled down and finally interrupted. We use this evidence to assess the relevance of different assumptions on technology and the wage setting process in equilibrium search and matching models and discuss the policy implications of our results for the EUC extensions in the US.

« Assessing the Welfare Effects of Unemployment Benefits Using the Regression Kink Design »
American Economic Journal: Economic Policy 7(4): 243-278, 2015.
[Abstract] [Slides] [Online Appendix] [Data & Programs]
Abstract: I show how, in the tradition of the dynamic labor supply literature, one can identify the moral hazard effects and liquidity effects of unemployment insurance (UI) using variations along the time profile of unemployment benefits brought about by exogenous variations in the benefit level as well as in the benefit duration. I use this strategy to investigate the anatomy of partial equilibrium labor supply responses to unemployment insurance (UI) in the US. I use administrative data on the universe of unemployment spells in five states from the late 1970s to 1984, and non-parametrically identify the effect of both benefit level and potential duration in the regression kink (RK) design using kinks in the schedule of UI benefits. I provide various tests for the robustness of the RK design, and assess its validity to overcome the traditional issue of endogeneity in UI benefit variations on US data. My results suggest that the response of search effort to UI benefits is driven almost as much by liquidity effects as by moral hazard effects, with an estimated ratio of liquidity to moral hazard effect of 88%. I then use these estimates to calibrate the welfare effects of an increase in UI benefit level and in UI potential duration.

« Migration and Wage Effects of Taxing Top Earners: Evidence from the Foreigners' Tax Scheme in Denmark »
with Henrik Kleven & Emmanuel Saez & Esben Schultz
Quarterly Journal of Economics , 129 (1): 333-378, 2014.
[Abstract] [Slides] [VOX-EU Summary for Broader Public]
Abstract: This paper analyzes the effects of income taxation on the international migration and earnings of top earners using a Danish preferential foreigner tax scheme and population- wide Danish administrative data. This scheme, introduced in 1991, allows new immigrants with high earnings to be taxed at a preferential at rate for a duration of three years. We obtain three main results. First, the scheme has doubled the number of highly paid foreigners in Denmark relative to slightly less paid ineligible foreigners, which translates into a very large elasticity of migration with respect to the net-of-tax rate on foreigners, between 1.5 and 2. Hence, preferential tax schemes for highly paid foreign workers could create severe tax competition between countries. Second, we find compelling evidence of a negative effect of scheme-induced increases in the net-of-tax rate on pre-tax earnings at the individual level. This finding cannot be explained by the standard labor supply model where pay equals marginal productivity, but it can be rationalized by a matching frictions model with wage bargaining where there is a gap between pay and marginal productivity. Third, we find no evidence of positive or negative spillovers of the scheme-induced influx of high-skilled foreigners on the earnings of highly paid natives.

« Taxation and International Mobility of Superstars: Evidence from the European Football Market »
with Henrik Kleven & Emmanuel Saez
American Economic Review 103(5): 1892-1924, 2013.
(NBER Digest summary for the broader public)
[Abstract] [Slides] [NBER WP Version] [VOX-EU] [Press Coverage]
Abstract: We analyze the effects of top tax rates on international migration of football players in 14 European countries since 1985. Both country case studies and multinomial regressions show evidence of strong mobility responses to tax rates, with an elasticity of the number of foreign (domestic) players to the net-of-tax rate around one (around .15). We also find evidence of sorting effects (low taxes attract high ability players who displace low ability players) and displacement effects (low taxes on foreigners displace domestic players). Those results can be rationalized in a simple model of migration and taxation with rigid labor demand.

[The Economist] [Bloomberg] [WSJ Blog] [Bloomberg] [Miller-McCune] [The New Republic] [France 2 (from 23' on)]

« Are Tax Incentives For Charitable Giving Efficient? Evidence from France »
with Gabrielle Fack
American Economic Journal: Economic Policy, 2(2): 117-41, 2010.
[Abstract]
Abstract: This paper estimates the effect of tax incentives for charitable contributions in France. We focus on two tax reforms, which took place in 2003 and 2005, that increased the non refundable tax credit rate for charitable contributions by 32%. We use a difference-in- difference identification, comparing the evolution of contributions for groups of households with similar income but different taxable status due to differences in family size. We control for censoring issues and investigate distributional effects using a three-step censored quantile regression estimator. We find that the elasticity of contributions with respect to tax subsidy is relatively small, between -0.2 and -0.6. We also show that the response to tax incentive tends to increase with the level of gifts.

SELECTED WORK IN PROGRESS:

« Gender Without Children »
with Petter Lundborg, Tatiana Pazem, Erik Plug & Johan Vikstrom
[slides available upon request]

Resting: « The BreadWinner Notch »
with Henrik Kleven [slides available upon request]

BOOKS & CHAPTERS:

« Biens publics, charite privee: Comment l'Etat peut-il reguler le charity business ? »
with Gabrielle Fack & Alix Myczkowski, Editions Rue d?Ulm/Presses de l?Ecole normale superieure, 2018
[Data & Website on Charitable Giving by the Wealthy Around the World] [Slides]

« Charitable giving and tax policy: a historical and comparative perspective »
Gabrielle Fack & Camille Landais, editors, CEPR conference volume, Oxford University Press.
[Data]

« Pour une revolution fiscale: Un impot sur le revenu pour le XXIeme siecle » (avec T. Piketty & Emmanuel Saez), Seuil (Janvier 2011).
[Tax reform simulator] [Press coverage]

« Cultural assimilation in France » (with Y. Algan & C. Senik),
in Cultural integration in Europe , (Y. Algan & A. Manning eds), CEPR/Oxford University Press, a paraitre, 2010

POLICY:

« Enhancing EU Capital Markets »
Joint Statement - French CAE & German SVR
Camille Landais, David Sraer, CAE
Monika Schnitzer, Veronika Grimm, Ulrike Malmendier, Achim Truger, Martin Werding, GCEE
[Abstract]
Abstract: The European Union needs to build stronger and deeper capital markets to finance opportunities such as the green transition or the rise of artificial intelligence, and to promote the resilience of EU economies in the face of financial shocks. Deep and liquid capital markets are essential to ensure long-term growth and to overcome the decline in the growth potential of European economies. Market-based financing encourages investment in new, riskier technologies and in research and development. However, Europe's financial architecture is still predominantly bank-based with largely national flows. We propose five policy measures to support a growth-oriented CMU agenda. To simplify the valuation of financial assets, the EU should extend the European Single Access Point (ESAP) initiative to private companies. In addition, improving and harmonizing national insolvency regimes can reduce costs, better allocate resources and encourage cross-border investment. To enhance the effectiveness of its supervision and to make it more conducive to market integration, the EU should strengthen and reform the European Securities and Markets Authority (ESMA). The redesign of ESMA's governance should include a compact executive board with sole authority over all administrative and supervisory decisions, and its activities should be funded primarily by a levy on the entities and market segments it supervises. Strengthening supplementary funded pensions could increase the amount of capital raised by institutional investors and invested in equity markets and as a result improve the depth of capital markets. Differences in national supervisory culture and practices may be the main reason for the equity-averse investment choices of insurers in some European countries. Deepening European supervisory integration through a reform of the EIOPA could harmonize supervisory culture. To foster the development of the EU venture capital (VC) market, the EU and Member States should increase public co-financing. This can be achieved by increasing funding to the European Investment Fund (EIF) and the European Tech Champions Initiative (ETCI). To build household confidence and participation in capital markets, the EU could introduce EU-funded investments accounts for children. This would allow children to experience different financial cycles and understand the long-term low risk and high reward of investing in equities.

« Les TPE-PME françaises face au choc énergétique : les enseignements des données bancaires, »
Focus #104, Conseil d’Analyse Economique January 2024

« Inflation Reducation Act: How Should the EU React? »
Joint Statement - French CAE & German SVR
Camille Landais, Sébastien Jean, Thomas Philippon, Aurélien Saussay, CAE
Monika Schnitzer, Veronika Grimm, Ulrike Malmendier, Achim Truger, Martin Werding, GCEE

« Que faut-il attendre des mécanismes de partage de la valeur ? »
with Maria Guadalupe & David Sraer
Note du Conseil d'Analyse Economique #79
[Slides] [Abstract]
Abstract: La question du partage de la valeur est de retour dans le débat public avec le projet de loi portant transposition de l’accord national interprofessionnel relatif au partage de la valeur au sein de l’entreprise, qui prévoit d’étendre l’obligation de mise en place d’un mécanisme dans les entreprises de moins de 50 salariés. Dans cette nouvelle Note du CAE, Maria Guadalupe, Camille Landais et David Sraer présentent les dispositifs de distribution de la valeur ajoutée en France et proposent une évaluation de l’impact de ces dispositifs sur les salaires, les performances des entreprises et les finances publiques. Ils soulignent que la substitution entre ces dispositifs de partage de la valeur et les salaires est le point central pour déterminer leur efficacité et que cette substitution varie selon les dispositifs en place. Pour poser les jalons d’une vraie politique du partage de la valeur et éviter les effets d’aubaine, ils recommandent de privilégier un dispositif unique idéalement assis sur une formule simple, transparente et clairement adossée à la profitabilité de l’entreprise (comme la participation obligatoire) mais dont les paramètres pourraient être négociés au niveau des branches ou même des entreprises.

« Electricity market design: Views from European economists »
CEPR Policy Insight #120
[Abstract]
Abstract: Europe has faced – and still faces – an unprecedented energy crisis that has translated into record-high gas and electricity prices. The rise in energy costs has been the main driver of inflation, with the EU average reaching 11.5% in October 2022, pushing the ECB to increase interest rates. Inflation, coupled with the hike in interest rates, has reduced European households’ disposable income and purchasing power, put the competitiveness of European industry at risk, and forced governments to implement – subject to their asymmetric fiscal capabilities – costly support mechanisms to mitigate some of the economic and social consequences of the energy crisis. These events have put electricity market design under the spotlight. The question is not only how to avoid the energy crisis from repeating itself in the future, but also how to promote low-carbon investments at the scale and speed necessary to decarbonize our economies while preserving security of supply. The shared view now is that these endeavours call for electricity market reform. The question is: in which direction?

« Can Inheritance Taxation Promote Equality of Opportunities? »
with Etienne Fize & Nicolas Grimprel
Forthcoming LSE Public Policy Review
[Abstract]
Abstract: After a period of relatively strong economic and social mobility during the post-WWII decades, labor income is now quickly losing its capacity to fuel mobility across the wealth distribution of Western economies, with inheritance becoming again the main determinant of individuals’ ability to make it to the top of the wealth distribution. At a time where inheritance taxation therefore seems desirable from both equity and efficiency standpoints, most inheritance tax systems are broken. They have failed to be truly progressive, and have remained very unpopular among the public. In this paper, we propose general principles to guide an in-depth reform of inheritance tax systems, to make them more efficient, progressive and transparent. Using administrative survey data from France, we also discuss whether the revenue generated by these reforms can promote equality of opportunities, by guaranteeing a wealth endowment for all. Based on detailed simulations, we explain why inheritance taxation alone cannot deal with the current dynamics of concentration of wealth at the top of the distribution, and why it needs to be complemented by progressive taxation of wealth and/or capital income.
[Slides]

« Micro-simuler l’impact des politiques publiques sur les ménages : pourquoi, comment et lesquelles ? »
with Francois Bourguignon
Note du Conseil d'Analyse Economique #74
[Slides] [Abstract]
Abstract: La gestion des politiques publiques réclame des instruments qui permettent d’anticiper l’impact des mesures en place ou de réformes proposées en termes budgétaires d’une part et distributifs d’autre part. Les modèles de « micro-simulation » essaient de répondre à cette double préoccupation en appliquant à chaque ménage d’un échantillon représentatif de la population les modifications des règles gouvernant la redistribution monétaire (prélèvements et prestations) sur la base de la situation économique des membres du ménage et sa composition. Sont présents aujourd’hui sur la scène française trois modèles de ce type : cette diversité est souhaitable, ne serait-ce que par souci de transparence et de neutralité. Cependant, les divers modèles ne sont pas toujours basés sur les mêmes sources de données, n’offrent pas le même niveau de détail et ne simulent pas nécessairement le même ensemble de mesures, si bien que les bilans redistributifs publiés ne sont pas toujours complètement convergents. Cet état de fait risque de créer un certain flou dans l’opinion et d’instiller un doute sur la précision et la neutralité des modèles, d’autant plus que les médias s’embarrassent rarement de distinguos méthodologiques. Cette Note fait le point sur les instruments actuels de micro-simulation en France, formule quelques propositions afin d’éviter la confusion entre les divers résultats publiés, et dresse quelques perspectives d’évolution. Sur la présentation des résultats d’abord, il est souhaitable que chaque organisme de micro-simulation utilise dans sa publication principale, ou dans une annexe en ligne, une grille de lecture qui soit commune à tous. L’exercice de comparaison entrepris dans cette Note montre aussi l’intérêt d’une démarche plus systématique de confrontation de leurs pratiques à l’initiative des modélisateurs et/ou des utilisateurs c’est pourquoi nous préconisons d’institutionnaliser les échanges entre modélisateurs, utilisateurs et producteurs de données au sein d’un séminaire annuel. Ensuite, la granularité est une dimension clé de la micro-simulation : des données plus fines permettraient en particulier une meilleure appréhension des queues de distribution (les plus modestes et les plus aisés) et de la variation des inégalités « horizontales ». Il est ainsi recommandé d’explorer l’utilisation de données administratives exhaustives ou quasi exhaustives dans la double dimension des revenus et des caractéristiques démographiques et socio-professionnelles des ménages. Nous recommandons enfin de maintenir une stricte séparation entre les exercices focalisés seulement sur les effets mécaniques, qui permettent d’appréhender les effets redistributifs, et les exercices incorporant en sus des réponses comportementales qui permettent d’évaluer l’impact budgétaire. Une prise en compte plus systématique des effets distributifs et redistributifs de toute mesure de politique économique lors de sa conception et de sa mise en oeuvre est éminemment souhaitable, mais aussi analytiquement délicate. Une voie possible pour faire évoluer la frontière de la micro-simulation serait de lancer des appels à projet de recherche, au-delà du champ classique du système socio-fiscal.