Jason Huang

Stanford University
Department of Economics
579 Serra Mall
Stanford, CA 94305

Email: jhuang99@stanford.edu

Curriculum Vitae

Public Economics
Microeconomic Theory

Expected Graduation Date:
June, 2018

Thesis Committee:

Caroline Hoxby (Primary):

Florian Scheuer:
Petra Persson:


Optimal Tax Mix with Income Tax Non-compliance (with Juan Rios)
Journal of Public Economics (December 2016).
Although developing countries face high levels of income inequality, they rely more on consumption taxes, which tend to be linear and are less effective for redistribution than a non-linear income tax. One explanation for this pattern is that the consumption taxes are generally more enforceable in these economies. This paper studies the optimal combination of a linear consumption tax with a non-linear income tax for redistributive purposes. In our model, households might not comply with the income tax code by reporting income levels that differ from their true income. However, the consumption tax is fully enforceable. We derive a formula for the optimal income tax schedule as a function of the consumption tax rate, the recoverable elasticities, and the moments of the taxable income distribution. Our equation differs from those of Mirrlees (1971) and Saez (2001) because households face a consumption tax and they respond to income tax not only through labor supply but also through mis-reporting their incomes. Both aspects are empirically relevant to our calibration of the optimal top rate in the Russian economy. We then characterize the optimal mix between a linear consumption tax rate and a non-linear income tax schedule. Finally, we find that the optimal consumption tax rate is non-increasing in the redistributive motives of the social planner.

Research in Progress

Impact of Food Inspection Grades on Restaurant Business and Customer Composition

In many markets, consumers cannot observe certain important product attributes, and this asymmetry of information leads to market inefficiencies. In the case of retail food establishments, customer cannot monitor the food hygiene in the back of the kitchens. Since 2010, New York City's Department of Health and Mental Hygiene began making the results from their inspections publicly available. Inspectors have been handing out letter grades summarizing the inspection results that the restaurants must post visibly on their entrance windows. By combining the food inspection data with proprietary debit and credit transactions data from 2014 to 2015, I study how consumer choices and customer composition react to changes in food inspection grades. I test not only whether the new information revealed by the changes in grades affects overall business but also whether repeat customers respond differently from transient ones. I find that getting a letter grade lower than $A$ is associated with an economically small but statistically significant dip in daily revenue and foot traffic. In addition, I find that customers who had frequented an establishment in the past two months were less responsive to the grade changes. The findings from this paper both measure the efficacy of a public policy and serve as evidence for hypothesis on consumer behaviors that data from previous studies have unable to provide.