Replication data for: Salience and Taxation: Theory and Evidence

Principal Investigator(s):  View help for Principal Investigator(s) Raj Chetty; Adam Looney; Kory Kroft

Version:  View help for Version V1

Name File Type Size Last Modified
LICENSE.txt text/plain 14.6 KB 10/12/2019 05:39:AM
README.pdf application/pdf 17.7 KB 10/12/2019 05:39:AM
alcohol_analysis.do text/plain 5.3 KB 10/12/2019 05:39:AM
alcohol_data.dta application/octet-stream 148.5 KB 10/12/2019 05:39:AM
collapsed_grocery_data.dta application/octet-stream 5.9 KB 10/12/2019 05:39:AM
grocery_dataprep.do text/plain 6.7 KB 10/12/2019 05:39:AM
grocery_placebo.do text/plain 1.4 KB 10/12/2019 05:39:AM
grocery_regressions.do text/plain 4 KB 10/12/2019 05:39:AM
raw_grocery_data.dta application/octet-stream 2.4 KB 10/12/2019 05:39:AM
survey_data.xls application/vnd.ms-excel 74 KB 10/12/2019 05:39:AM

Project Citation: 

Chetty, Raj, Looney, Adam, and Kroft, Kory. Replication data for: Salience and Taxation: Theory and Evidence. Nashville, TN: American Economic Association [publisher], 2009. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-12. https://doi.org/10.3886/E113312V1

Project Description

Summary:  View help for Summary Using two strategies, we show that consumers underreact to taxes that are not salient. First, using a field experiment in a grocery store, we find that posting tax-inclusive price tags reduces demand by 8 percent. Second, increases in taxes included in posted prices reduce alcohol consumption more than increases in taxes applied at the register. We develop a theoretical framework for applied welfare analysis that accommodates salience effects and other optimization failures. The simple formulas we derive imply that the economic incidence of a tax depends on its statutory incidence, and that even policies that induce no change in behavior can create efficiency losses. (JEL C93, D12, H25, H71)

Scope of Project

JEL Classification:  View help for JEL Classification
      C93 Field Experiments
      D12 Consumer Economics: Empirical Analysis
      H25 Business Taxes and Subsidies including sales and value-added (VAT)
      H71 State and Local Taxation, Subsidies, and Revenue


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V1 [2019-10-12]

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