Egbert Jongen: Using Tax Deductions to Promote Lifelong Learning: Real and Shifting Responses
OFS-seminar. Egbert Jongen is a associate professor at Leiden University. Egbert Jongen will present the paper "Using Tax Deductions to Promote Lifelong Learning: Real and Shifting Responses" co-authored by Wiljan van den Berge and Karen van der Wiel
Foto: Leiden University
Policymakers are concerned about underinvestment in lifelong learning. We study the effects of a tax deduction for lifelong learning, exploiting exogenous variation in the effective costs of lifelong learning due to jumps in tax bracket rates. We use a regression kink and regression discontinuity design and tax return data on the universe of Dutch taxpayers. Low-income singles show no response, but high-income singles are 10% more likely to have lifelong learning expenditures. In couples, shifting of lifelong learning expenditures between partners in tax returns leads to spurious large estimates for primary earners and spurious negative estimates for secondary earners.