UNIVERSITY OF CALIFORNIA, BERKELEY
DEPARTMENT OF ECONOMICS
PLACEMENT SERVICE: Victoria Lee place@econ.berkeley.edu
atazhitd@berkeley.edu http://alisatns.weebly.com/
BUSINESS ADDRESS:
Department of Economics
530 Evans Hall, #3880
Berkeley, CA 94720-3880
Cell: (510) 505-4254
DESIRED RESEARCH AND TEACHING FIELDS:
PRIMARY
Public Finance
Labor Economics
FIELDS OF CONCENTRATION:
Public Finance, Psychology and Economics
SECONDARY
Psychology and Economics
Personnel Economics
DISSERTATION TITLE:
Principal Advisor:
“Essays in Public Finance”
Expected Date of Completion: May 2016
Prof. Emmanuel Saez
Other References:
PRE-DOCTORAL STUDIES:
University of Waterloo, Canada
Prof. Alan Auerbach
Prof. Hilary Hoynes
DEGREE
M.Math.
University of Western Ontario, Canada
PROFESSIONAL EXPERIENCE:
Honors B.Sc.
DATE
2010
2008
FIELD
Statistics, Finance
Applied Math, Economics
TEACHING:
Instructor, Department of Economics, U.C. Berkeley
Psychology and Economics (Summer 2013)
Head Graduate Student Instructor, Department of Economics, U.C. Berkeley
Coordinated hiring of TAs, handled enrollment issues, organized course evaluations (Fall 2012 – Summer 2014)
Teaching Assistant, Department of Economics, U.C. Berkeley
Industrial Organization (Glenn Woroch, Spring 2012)
Game Theory (Robert Powell, Fall 2011)
Microeconomics (Scott Carson, Summer 2011)
PAPERS:
“Adjust Me if I Can’t: The Effect of Firm Incentives on Labor Supply Responses to Taxes” (Job Market Paper)
Using administrative data, I study behavioral responses to incentives generated by the “Mini-Job" program aimed at increasing labor supply of low-income individuals in Germany. I show evidence of strong behavioral responses – in the form of sharp bunching – to the mini-job threshold that generates large discontinuous changes both in the marginal tax rates and in the total income and payroll tax liability of individuals in Germany. To calculate elasticities of earnings with respect to net-of-tax rate I extend the bunching method to frameworks with large kinks and notches.
Sharp bunching translates into elasticity estimates that are an order of magnitude larger than has been previously estimated using the bunching approach. To explain the magnitude of the observed response, I focus on firm incentives. I show theoretically that in the presence of search costs, the magnitude of labor supply responses to taxes depends not only on the magnitude of tax changes, but also on the statutory incidence of taxes. The model predicts that labor supply responses are stronger when the statutory incidence of taxes falls on firms. To support the theoretical findings I show that in addition to tax rates, fringe benefit payments also change at the threshold. Using a large survey of businesses and a household survey, I compare wages and fringe benefits around the mini-job threshold and find that gross wages paid to mini-job workers are approximately 6% larger than gross wages paid to

regular part-time workers. At the same time, mini-job workers receive smaller yearly bonuses and fewer vacation days than regular workers. These results indicate that lower fringe benefits make mini-jobs attractive to employers, thus facilitating labor supply responses in accordance with the model's predictions.
“Optimal Reporting Thresholds: Theory and Evidence from Charitable Contributions”
Information reporting has been argued to be an effective tool against evasion. However, even the simplest compliance rules can prove to be costly to taxpayers. The trade-off between evasion and compliance costs suggests that reporting should be enforced only on a subset of the population. This paper studies the question of how to optimally set compliance thresholds. I begin by considering a reform in 1985 that simplified reporting rules for charitable contributions in the form of assets. I exploit this natural experiment to show that reporting rules are indeed costly to taxpayers but successful at reducing evasion associated with the claiming of charitable deductions. Comparing pre- and post-reform distributions of charitable donations I find that relaxing reporting requirements in 1985 led to an increase in donations in 1986, but that 50-60% of these new donations were untruthful. This tax revenue loss, however, was offset by substantial savings on behalf of taxpayers: I find an average compliance cost of $137 dollars
(in 2013 dollars) per person. I also find evidence suggesting that the reform triggered a period of growth in asset donations. Finally, I investigate which groups of individuals are more prone to evasion and show suggestive evidence that single not self-employed individuals with incomes in the top quartile of AGI are more likely to take advantage of evasion opportunities. Next I develop and calibrate a theoretical model to analyze optimal thresholds. I show that optimal threshold determination should take into account the utility loss from compliance cost experienced by individuals and loss in externality benefits against tax revenue changes and utility gain of evaders. I show that the type and magnitude of evasion behavior has the strongest influence on determining the optimal threshold.
“Behavioral Responses to Payroll and Income Taxes in the UK”
I study behavioral responses to changes in marginal tax rates of social security and income taxes. I find that responses depend on individual’s employment status: whether a worker is a wage earner, self-employed, or a proprietor. In line with the existing literature I document weak (but statistically significant) bunching at kink points of the tax schedule among wage earners. Starting from 1999, wage earners accumulate pension credits when they exceed a certain threshold, however, no contributions are due until earnings reach a second, higher threshold. Even 10 years after this reform I find no bunching to the right of the eligibility threshold, suggesting that individuals do not assign a high value to pension benefits. Lack of bunching is persistent across age groups and unlikely to be explained by friction costs as individuals are able to bunch at other kink points. I find strong responses to tax incentives among the selfemployed but the responses differ by the type of kink. I find sharp bunching at the first kink, medium bunching at the top kink and weak bunching at the middle kink. Comparing responses before and after a tax reform that changed the magnitude of kinks I find that self-employed individuals aggressively reduce earnings to bunch at the lower, more salient kink points. Finally, I document large income shifting by proprietors: many firm owners report most of income as dividends thus avoiding social security taxes. Nevertheless many proprietors choose to pay themselves suboptimally high wages thus incurring an unnecessarily high tax liability. I show that some of these proprietors pay multiples of £5,000 or £6,000. As a next step, I will use administrative panel data to better understand how selfemployment earnings and proprietors’ wages respond to tax incentives.
WORK IN PROGRESS:
“Income Shifting and the Cost of Incorporation”
I study the choice of organizational form by business proprietors in the UK. Since 1999 incorporation offers substantial tax savings in addition to liability protection over the traditional self-employment in the UK. Drawing on the administrative data of the full population of the self-employed individuals, I show that a substantial proportion of business owners fail to incorporate. This finding challenges the standard assumption of perfect optimization by firms.
To investigate how proprietors decide on the organizational form I study natural experiments that changed the relative attractiveness of incorporation. I show that the probability of incorporation increases when corporate tax rate decreases, or when National Insurance Contributions or income tax increase, but the magnitude of response is small. I find no anticipatory responses to incorporation even though all tax changes are announced at least one year in advance. The results suggest that either incorporation incurs large fixed and yearly costs, or individuals suffer from behavioral bias.
"Who Wants a Second Job? Evidence from a Tax Reform in Germany"
When evaluating labor supply responses to tax cuts, researchers are never certain as to what extent increases in labor supply are limited by the inability of workers to extend their working hours as desired. I attempt to circumvent this concern by studying a reform in Germany that allowed part-time and full-time workers earning more than € 400 per month to hold a second job tax-free as long as earnings from this secondary job do not exceed € 400 per month. The

reform thus generated a very strong incentive to acquire a secondary job, at minimum offering a 20% tax break on additional income. Preliminary results show that this reform lead to a large increase in the take-up of secondary jobs, with the majority of these employments concentrated around the € 400 cutoff. Using an administrative panel dataset of labor histories in Germany, I investigate several outcomes of interest. First, I study how the likelihood of secondary employment changes with one’s marginal tax rate and demographic characteristics. Second, I study the intensive margin of response: individuals with secondary jobs at the moment of reform were subject to both income and substitution effects. I study how their labor supply changes after the reform. And third, I study whether this reform lead to job splitting, whereby individuals with larger earnings reduce hours in their main job and acquire a secondary job to save on taxes.
"Hour Requirements for In-Work Benefits: Do They Help or Do They Hurt?"
I study how rules governing in-work subsidies affect program participation. In contrast to the Earned Income Tax
Credit in the USA that provides in-work subsidies starting from the first dollar earned, the Working Tax Credit
(WTC) in the UK requires individuals to work a certain number of hours per week before they can qualify for benefits. On the one hand, the WTC program incentivizes individuals to seek out substantial employments. On the other hand, needy individuals who are genuinely trying to find work but unable to meet the hour requirement are denied benefits. I investigate how hour requirements affect program participation by studying a reform that increased the hour requirement for couples from 16 hours to 24 hours per week. Using administrative data on the full sample of the WTC recipients I find that a large number of couples were able to increase working hours from 16 to 24 as evident by a shift of excess mass from 16 times the minimum wage to 24 times the minimum wage. However, nearly
50% of couples who were previously eligible were not able or chose not to increase their labor supply, and therefore lost WTC benefits.
PRESENTATIONS:
2015
2014
First International FDZ Data User Workshop, Canadian Public Economics Group, U.C. Berkeley
Public Finance Seminar, U.C. Berkeley Labor Lunch
U.C. Berkeley Public Finance Lunch
FELLOWSHIPS AND AWARDS:
2015
2014, 2015
2014 – 2015
2014
2011 – 2014
2010
2008 – 2010
Center for Equitable Growth Fellowship, U.C. Berkeley
Graduate Division Summer Grant, U.C. Berkeley
Doctoral Completion Fellowship, U.C. Berkeley
Burch Center Continuing Student Fellowship, U.C. Berkeley
Social Sciences and Humanities Research Council of Canada, PGS D Scholarship
Departmental Fellowship, U.C. Berkeley
Natural Sciences and Engineering Research Council of Canada, CGS M Scholarship
2008
2007
U. of Western Ontario Dillon Gold Medal (highest combined average in Applied Math Program)
Jake Greydanus Applied Math Prize (highest combined average in Calculus and Linear Algebra)
PROFESSIONAL EXPERIENCE:
Financial Engineering Summer Associate, Scotia Capital (Toronto, Canada, 2009)
Intern, Robertson, Eadie and Asssociates (Oakville, Canada, 2008)
OTHER INFORMATION:
Languages:
Citizenship:
English (fluent), Russian (native), Spanish (intermediate), German (intermediate)
Canada, Russian Federation