With respect to the efficacy of the MID in promoting economic mobility, the authors state:
“Mortgage interest deductions are also positively related to intergenerational mobility.”
“In sum, there is some evidence that CZs (commuting zones) with larger mortgage interest deductions as a fraction of AGI are more economically mobile”
Summarizing their statistical findings the team writes:
“…we find evidence that the tax expenditure components of mortgage interest deductions, state income taxes, and state EITCs each have individually positive effects on intergenerational mobility. The progressivity of overall tax expenditures and state income taxes also have a robust, significant relationship with higher intergenerational mobility. Overall, these results suggest that tax expenditures aimed at low-income taxpayers can have significant impacts on economic opportunity. Hence, the short-term fiscal gains from reducing such expenditures must be weighed against the potentially large long-term costs of reduced income growth for low income individuals.”
Copyright© 2013 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.
Content on this website is copyrighted and may not be redistributed without express written permission from RISMedia. Access to RISMedia archives and thousands of articles like this, as well as consumer real estate videos, are available through RISMedia's REsource Licensed Content Solutions. Offering the industry’s most comprehensive and affordable content packages. Click here to learn more! http://resource.rismedia.com