Abstract
High-Income Taxpayers' Reactions to Marginal Income Tax Rates Changes in France, 1970-1996 by Thomas Piketty This paper uses the main income tax law changes that occured in France over the 1 970- 1 996 period as " natural experiments " in order to estimate the elasticity of high-income taxpayers' taxable income with respect to marginal tax rates. Given the large pro-cyclicity of the very-high-income taxpayers' income share over the entire period, we use annual tax returns data about the level and composition of income within the top decile and the top centile of the taxpayers distribution of taxable income. The general conclusion is that the relatively large changes in top marginal income tax rates (both in 1981-1982 and 1 986- 1 987) - did not induce any important structural change in the distribution. The distribution of taxable income among high-income taxpayers is extremly stable in France over the entire 1970-1996 period, and short-term fluctuations are better explained by the business cycle than by tax-induced behavioral changes.
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