Two Essays on Income Tax Progressivity and Immigration Enforcement

During the mid-2010s, 9 states plus Washington, D.C. enacted policies enabling undocumented immigrants to get driver's licenses, with the expectation that this would reduce the risk of deportation while driving. In the first chapter of my dissertation, I provide the first empirical evidence on this matter, with results suggesting that making driver's licenses accessible to undocumented immigrants did not reduce immigration enforcement. I also find suggestive evidence of increases in deportations through the Criminal Alien Program and Border Patrol. In the second chapter of my dissertation, I (and my co-author David Merriman) study the extent to which state personal income tax systems redistribute income. We analyze the tax systems’ overall redistribution and decompose over-time changes in redistribution into those resulting from changes in progressivity and those resulting from changes in average tax rates. We then decompose redistribution as being determined by three features of the tax system: deductions, statutory tax rates, and credits. Our empirical analysis shows that in 2011 income redistribution in some state tax systems was as large as 30 percent of the redistribution from the federal tax system. We show that decreases in average tax rates as well as decreases in progressivity—in the sense that income tax payments became less clustered at higher levels of income—contributed to decreases in over-time redistribution. We then document that redistribution is primarily caused by deductions, with 60\% of redistribution being due to deductions. We show that credits as of 2021 now account for about 9\% of redistribution – a tripling of their significance since 2001. Lastly, we show the decline in redistribution to be caused primarily by reductions in redistribution from statutory tax rates.