The Effects of Tax Changes on Economic Activity: A Narrative Approach to Frequent Anticipations*

• 成果类型: Article
• 署名作者: Garcia-Uribe, Sandra
• 署名单位: Banco de Espana
• 刊物名称: ECONOMIC JOURNAL
• ISSN/ISSBN: 0013-0133
• DOI: 10.1093/ej/ueac064
• 发表日期: 2022
• 页码: 706-727
• 关键词: household consumption; news

摘要

This paper studies the effects of anticipations of tax changes on economic activity through the release of tax news in the media in the United States. I provide a measure of anticipations by exploiting the content of television news. This information typically flows faster than standard measures of gross domestic product, thus I propose a mixed frequency dynamic factor model to estimate both the economic activity latent factor and the effects of anticipated tax shocks on it. I find that one-month-ahead anticipations of tax cuts significantly stimulate current economic activity while those of tax increases produce the opposite effect.