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Non-bunching at kinks and notches in cash transfers in the Netherlands

  • Nicole Bosch
  • Egbert Jongen
  • Wouter LeendersEmail author
  • Jan Möhlmann
Article

Abstract

We study the behavioural responses to kinks and notches in the Dutch system of cash transfers, using data on the universe of Dutch households for the period 2007–2014. We typically do not find statistically significant evidence of bunching around kinks or notches, neither in income nor in wealth. This finding is robust across different household types and modes of employment. We consider potential mechanisms that can explain this apparent lack of bunching.

Keywords

Bunching Cash transfers Income Wealth 

JEL Classification

D83 H24 H31 

Notes

Acknowledgements

We have benefited from comments and suggestions by two anonymous referees, Michael Best, Matthijs Jansen, Henrik Kleven, Barra Roantree and seminar and conference participants at CPB Netherlands Bureau for Economic Policy Analysis, the NED 2017 in Amsterdam, the SMYE 2018 in Palma de Mallorca and the IIPF 2018 in Tampere. Furthermore, we thank Patrick Koot and Marente Vlekke for their assistance in calculating the effective marginal tax rates using MIMOSI, Statistics Netherlands for access to the microdata (Project 8074) and Reinder Lok of Statistics Netherlands for additional information on the microdata. Remaining errors are our own.

Supplementary material

10797_2019_9555_MOESM1_ESM.pdf (5.8 mb)
Supplementary material 1 (pdf 5936 KB)

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Copyright information

© Springer Science+Business Media, LLC, part of Springer Nature 2019

Authors and Affiliations

  1. 1.CPB Netherlands Bureau for Economic Policy AnalysisThe HagueNetherlands
  2. 2.Leiden UniversityLeidenNetherlands
  3. 3.IZABonnGermany
  4. 4.University of ZurichZurichSwitzerland

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