The Benefits to Taxpayers from Increases in Students - RAND ...

88 The Benefits to Taxpayers from Increases in Students’ Educational Attainment
Population Identifiers
Because the effects of increased educational attainment may vary across population
groups, we conducted separate analyses for each of eight population groups distinguished
by gender and race/ethnicity (four groups). Some of the analyses also take
account of an individual’s age. The identifiers are routinely contained in all surveys
used in this research. Depending on the case, the type of response might differ, such as
one survey asking for age as of last birthday and another asking for birth date. Necessary
mappings have been made whenever necessary.
“White” means that the individual has not declared any other race or ethnicity.
“Black” means that the individual is a non-Hispanic black. “Asian” means a
non-Hispanic, non-black Asian. Hispanic means that the individual is coded as a
Hispanic. Necessary mappings have been made whenever necessary to convert survey
responses to desired variable structure.
Taxation Data
For payroll taxes, we retrieved statutory taxation rates and the ceiling applicable to
Medicare tax from the Annual Statistical Supplement to the Social Security Bulletin,
2002 (Social Security Administration, 2002). For federal taxes, we obtained average
2002 taxation rates by income group from the Internal Revenue Service’s Statistics of
Income Bulletin (Parisi, 2004–2005). For state and local taxes, we sourced U.S. average
taxation rates by income group from McIntyre et al. (2003).
The analysis uses these rates and applies them to earnings (payroll taxes) or personal
or family income (for income taxes) from the SIPP (U.S. Census Bureau, 2005a,
2005b, 2005c).
Social Program Data
Program Participation
The SIPP provides participation data for all social support and insurance programs
analyzed in this research. Basically, we use the survey’s flag-type questions related to
the respondent’s participation in various programs. We assign participation the value
of 1 if the response is positive for at least one month during 2002. For Medicare and
Medicaid, we also make a distinction between outpatient and inpatient participation,
since the benefit level varies tremendously between these two. Here, we interpret any
participation as outpatient participation and hospitalization as inpatient participation.