Diversity and Transformation: African Americans and African Immigration to the United States

Successive generations of African immigration have continuously transformed the African American community and the sociopolitical climate of the United States.Though the history of African immigration to the United States has at times been a turbulent one, the arrival of many different African peoples has profoundly impacted the social makeup of the United States. During this nation's infancy, hundreds of thousands of captive Africans were delivered to American shores. Overcoming tremendous adversity, this population and its successive generations laid the foundations of opportunity for a new wave of immigration after 1965. From Jim Crow to the Civil Rights Movement to desegregation, African Americans have been instrumental in transforming the sociopolitical climate in the United States, creating an environment far more accepting of new immigrants. A series of post-1965 immigration policy shifts opened the doors to a steady increase in African immigration in the latter part of 20th century. Today, approximately 50,000 Africans arrive annually

Auditor’s perceptions of CEOs overconfidence in Egypt : a quasi-experimental study

Purpose: This study aims to explore auditor’s perceptions of CEOs overconfidence in Egypt as one of the emerging countries. Design/methodology/approach: A quasi-experimental study is used on a sample comprises of 101 practicing auditors at public accounting firms in Egypt to assess (i) CEO overconfidence in a case scenario, (ii) the quality of earnings that would be provided by this overconfident CEO, and (iii) how overconfident CEO would be considered when they are assessing fraud risk, audit risk, audit effort and audit fees. Findings: The results suggest that not all the auditors in the sample were able to discover the same degree of overconfidence personal traits in a case scenario, and it was done by the sense, and they generally agree that overconfident CEO are more likely to provide lower earnings quality. Accordingly, they raise their assessment for audit fees as a result of an increase in fraud risk, audit risk, and audit effort. Practical implications: This study has significant implications for accounting and auditing professionals, market participants and regulators; where auditors should consider the overconfidence of the CEO during the audit process, market participants should consider managerial overconfidence when they are making investment decisions. Moreover, this study highlights the gap between auditing standards and the professional practice; which requires regulators to consider personal overconfidence traits as an indicator of financial reporting risk. Originality/value: This study helps in filling a gap in the literature; where auditor’s perceptions of CEOs overconfidence have not been fully investigated in emerging economies.peer-reviewe

Trends in High Incomes and Behavioral Responses to Taxation: Evidence from Executive Compensation and Statistics of Income Data

This paper examines income trends from 1992 to 2004 and the responsiveness of different income measures to tax changes for corporate executives and for the very highest income U.S. taxpayers. We detail the growth in executive compensation and break down the components of that growth by sources, such as the value of options and stock grants, as well as bonus income. We then examine income trends at various points in the income distribution for executives and for all taxpayers. An empirical strategy similar to that employed by Goolsbee (2000) is then used to examine the responsiveness to tax rates of broad measures as well as individual sources of executive compensation. Additionally, we investigate the impact of marginal tax rates applying to corporate income, personal income, and capital gains on the composition of executive compensation. Consistent with other studies, we find that most of the growth and volatility in incomes has been concentrated within the top one percent of taxpayers, for whom income grew sharply between 1992 and 2000, and then declined sharply from 2000 to 2002. Below the top one percent, income patterns are much more stable. Income patterns for executives are similar to, but more volatile than, those for the very highest income taxpayers. Salary income of executives has been relatively stable, while the value of their stock options, stock grants, and bonuses has grown tremendously. We use data from two sources: a panel of executives and IRS tax returns from the Statistics of Income. Our elasticity estimates based on the panel of executives may be more reliable than those based on the tax panel because the regressions include firm-specific information that helps to explain changes in income. For executives, our permanent earned income elasticity estimate for the early 1990s is 0.19 (with substantial transitory shifting of income into the year prior to the 1993 tax increase). There is also evidence of substantial transitory income shifting around the time of the 2001 Economic Growth Tax Relief and Reconciliation Act (EGTRRA), but the overall estimated elasticity is negative. The results are not definitive, however. Our results are sensitive to many factors, such as the time-period examined, the data set used, and the econometric specification. That inconsistency reflects the complexities inherent in estimating high-income behavioral responses to taxation. The fact that the elasticity estimates differ greatly across time-periods and across the two datasets suggests that non-tax factors are extremely important. That observation is consistent with several other papers (Slemrod 1996, Saez 2004, Kopczuk 2005, Giertz 2006) that all show a great deal of sensitivity surrounding taxable income elasticity estimates.Elasticity of Taxable Income; Behavioral Responses to Taxation; Taxation; Executive Compensation; Income Distribution;

The Earned Income Tax Credit and the Labor Supply of Married Couples

Over 18 million taxpayers are projected to receive the Earned Income Tax Credit (EITC) in tax year 1997, at a total cost to the federal government of about 25 billion dollars. The EITC is refundable, so any amount of the credit exceeding the family’s tax liability is returned in the form of a cash refund. Advocates of the credit argue that this redistribution occurs with much less distortion to labor supply than that caused by other elements of the welfare system. This popular view that the credit “encourages work effort” is unlikely to hold among married couples. Theory suggests that primary earners (typically men) would increase labor force participation, but secondary earners would reduce their labor supply in response to an EITC. We study the labor supply response of married couples to several EITC expansions between 1984 and 1996. Although our primary interest is the response to changes in the budget set induced by the EITC, our estimation strategy takes account of budget set changes caused by federal tax policy, and by cross-sectional variation in wages, income, and family size. We use both quasi-experimental and reduced-form labor supply models to estimate the impact of EITC-induced tax changes. The results suggest that EITC expansions between 1984 and 1996 increased married men’s labor force participation only slightly but reduced married women’s labor force participation by over a full percentage point. Overall, the evidence suggests that family labor supply and pre-tax family earnings fell among married couples. Our results imply that the EITC is effectively subsidizing married mothers to stay at home, and therefore have implications for the design of the program.