IESET.
Hypotheses·distribution·tax_inequality_australia_2009_top_rate_response

The Australian Rudd-Swan 2008-2010 top-rate adjustments (Medicare-levy surcharge changes + temporary flood levy 2011 + ongoing top-bracket threshold movements) plus the 2014-2017 Abbott temporary deficit-levy produced top-1 pretax income share dynamics with an absolute elasticity to the headline top rate below 0.5, consistent with the Australian imputation-credit franking system reducing the income-shifting margin for high-earner business owners.

The discriminating test is the headline- rate elasticity vs an OECD-imputation-system-comparator pool.

PARTIALengine/runs/tax_inequality_australia_2009_top_rate_response

PARTIAL — cumulative_effect=+0.09768, h=5, p_h=0.776 (above α=0.10)

confidence cueThe result is useful, but not decisive. Treat it as a clue, not a settled conclusion.

policy briefMixed or noisy

In ordinary language

Over a long period, do more market-oriented institutions translate into higher income or productivity, once the comparison looks beyond a single success story?

plain answer

The evidence is suggestive but not decisive. cumulative_effect=+0.09768, h=5, p_h=0.776 (above α=0.10)

why it matters

Distributional claims often sound morally clear but are empirically complex. This test asks whether the proposed channel explains real differences across places.

how the test works

It compares 8 country or place units from 1995 to 2020, using a local projections design, with fixed effects for country and year.

what was measured
What changed
  • Top marginal income tax rate
What we checked
  • Top 1pct pretax income share
what this does not prove

A single test is not the whole truth. It narrows the claim under a specific sample, time period, and method. Strong policy conclusions need the pattern to survive nearby tests, alternative data, and serious objections.

verification

No evidence packet has been generated yet.

Results

engine/runs/tax_inequality_australia_2009_top_rate_response
1007550250199520082020AUSNZLCANGBRUSAJPNFRA
illustrative sketch · run pending
No coefficients yet. When the model fires, this chart will show top_1pct_pretax_income_share across 8 sampled countries over 1995–2020.
The shapes above are stylised — none of the lines are real data.
Placeholder for tax_inequality_australia_2009_top_rate_response. Published chart will be generated from engine/runs/tax_inequality_australia_2009_top_rate_response/chart_data.json.

Pre-registration

registration ordering unverified
first-spec commit 4c8ce8e · 2026-07-18T22:11:21Z
run generated · 2026-04-30T12:29:39Z
Run timestamp predates this path's first git-add commit (rebase, rename, or pre-git local run). Spec hash is still the path's first-add commit — not repository HEAD — but ordering is not a clean pre-registration proof.

The Australian Rudd-Swan 2008-2010 top-rate adjustments (Medicare-levy surcharge changes + temporary flood levy 2011 + ongoing top-bracket threshold movements) plus the 2014-2017 Abbott temporary deficit-levy produced top-1 pretax income share dynamics with an absolute elasticity to the headline top rate below 0.5, consistent with the Australian imputation-credit franking system reducing the income-shifting margin for high-earner business owners. The discriminating test is the headline- rate elasticity vs an OECD-imputation-system-comparator pool.

Falsification criterion — what would disprove this

set before the run · honoured after

This hypothesis is considered falsified if:

SUPPORTED if Australian absolute top-1 share elasticity to top rate over 2005-2020 is below 0.5 AND below the OECD-comparator median at p<0.10. REFUTED if elasticity exceeds 0.7 in absolute value or exceeds OECD median at p<0.10.

formal test & threshold
test:      Australia time-series + OECD comparator panel local-projections of top-1 share on top-rate change.

Method

Template
local_projections
Fixed effects
country, year
Clustering
country
Sample
8 countries · 1995 – 2020
Evidence type
associational

Local-projections of top-1 share on top-rate change with country FE. Driscoll-Kraay SEs.

Data

VariableSourceTransform
top_1pct_pretax_income_share
outcome
owid:top-1-share-of-total-incometier 2
level
top_marginal_income_tax_rate
treatment
owid:top-marginal-income-tax-ratetier 2
level
log_real_gdp_per_capita
control
world_bank_wdi:NY.GDP.PCAP.KDtier 2
log
trade_openness
control
world_bank_wdi:NE.TRD.GNFS.ZStier 2
level

● ready  · ● pending  · ● reconstruct-needed

Detailed result card

Result card — tax_inequality_australia_2009_top_rate_response

Verdict: PARTIAL — cumulative_effect=+0.09768, h=5, p_h=0.776 (above α=0.10)

Pre-registration

  • Claim: The Australian Rudd-Swan 2008-2010 top-rate adjustments (Medicare-levy surcharge changes + temporary flood levy 2011 + ongoing top-bracket threshold movements) plus the 2014-2017 Abbott temporary deficit-levy produced top-1 pretax income share dynamics with an absolute elasticity to the headline top rate below 0.5, consistent with the Australian imputation-credit franking system reducing the income-shifting margin for high-earner business owners. The discriminating test is the headline- rate elasticity vs an OECD-imputation-system-comparator pool.
  • Falsification rule: SUPPORTED if Australian absolute top-1 share elasticity to top rate over 2005-2020 is below 0.5 AND below the OECD-comparator median at p<0.10. REFUTED if elasticity exceeds 0.7 in absolute value or exceeds OECD median at p<0.10.

Local-projections IRF

  • Method: Jordà local projections (TWFE, country-clustered)
  • Cumulative effect: +0.09768
  • Final-horizon p-value: 0.776

| h | β | SE | p | n | |---|---|---|---|---| | 0 | +0.01794 | 0.0502 | 0.721 | 93 | | 1 | +0.01491 | 0.0506 | 0.768 | 88 | | 2 | +0.009512 | 0.0639 | 0.882 | 83 | | 3 | +0.01906 | 0.0718 | 0.791 | 78 | | 4 | +0.01203 | 0.0753 | 0.873 | 74 | | 5 | +0.02424 | 0.0852 | 0.776 | 70 |

Variables resolved

  • owid:top-1-share-of-total-income → top_1pct_pretax_income_share (outcome, n=3294)
  • owid:top-marginal-income-tax-rate → top_marginal_income_tax_rate (treatment, n=590)
  • world_bank_wdi:NY.GDP.PCAP.KD → log_real_gdp_per_capita (controls, n=14066)
  • world_bank_wdi:NE.TRD.GNFS.ZS → trade_openness (controls, n=10714)

Generated by scripts/run_local_projections.py at 2026-04-30T12:29:39+00:00

Notes

Tax-inequality candidate, swarm-S6 batch 4. Australian dividend-imputation system is uniquely identifying for income-shifting elasticity.

Authored framework. Read the transparency note.