These taxable income levels will be indexed for inflation after 2008. In addition, the Act decreased the tax rates above 15 percent, effective January 1, 2001, as follows: The overall limitation on itemized deductions and the personal exemption phase-out will be reduced by one-third
Zodrow for helpful comments. We thank Henry Aaron and Samara Potter for extraordinarily helpful comments on the penultimate draft of this paper. We also thank Jim Sly for research assistance. Views and opinions expressed in this paper are those of the authors and do not necessarily represent the policies or positions of the Treasury Department or the staff, officers, or trustees of the Brookings Institution.
This paper provides an analytical framework for evaluating the effects of individual health insurance mandates on coverage. That framework draws from three literatures-health economics, tax compliance, and behavioral economics-to identify the factors that affect people's responses to health insurance mandates. The health economics literature explains how people value health insurance and how changes in its costs affect coverage. The tax compliance literature indicates that the probability of detection and people's attitudes toward risk affect perceptions of those costs. The salience of the mandate and social norms-factors from the behavioral economics literature-also may affect coverage decisions.
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