CEU Electronic Theses and Dissertations, 2024
| Author | Le, Vu Giang |
|---|---|
| Title | Financing Universal Basic Income through Taxes: A General-Equilibrium Approach |
| Summary | This thesis examines whether raising income tax rate can sustainably finance a modest universal basic income (UBI) proposal through a computable general equilibrium module in charge of macro variables combined with a microsimulation modelling the behavioral response of individual’s labor supply. Using a German social accounting matrix (SAM) and household panel data, a modest hypothetical UBI can potentially lead to a decrease in labor supply. In that case, a corresponding rise in wage is expected. Firms will pass some of the increasing cost to consumers, causing the consumer price index to go up and aggregation consumption to decline. Ultimately, GDP is negatively impacted. However, it is also equally possible that individuals will increase their labor supply instead. Moreover, the negative effect on GDP (if any) is small. Thus, funding a modest UBI solely though income tax is possible. |
| Supervisor | Ratfai, Attila |
| Department | Economics MA |
| Full text | https://www.etd.ceu.edu/2024/le_vu.pdf |
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