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AbstractOne major criticism of Universal Basic Income is that unconditional cash transfers discourage recipients from working. Evidence to date has largely relied on targeted and/or conditional transfer programs. However, it is difficult to draw conclusions from such programs because universal transfers may induce a positive demand shock by distributing cash to a large portion of the population, which may in turn offset any negative labor supply responses. We estimate the causal effects of universal cash transfers on short‐run labor market activity by exploiting the timing and variation in size of a long‐running unconditional and universal transfer: Alaska's Permanent Fund Dividend. We find evidence of both a positive labor demand and negative labor supply response to the transfers. Small negative effects on the number of hours worked are found for women, especially those with young children. In contrast, we find an increase in the probability of employment for males in the months following the distribution. Altogether, a $1,000 increase in the per‐person disbursement leads to a 0.8 percent labor market contraction on an annual basis.

Tax enforcement can be prohibitively costly when market transactions and participants are difficult to observe. Evasion among market participants may reduce tax revenue and provide certain types of suppliers an undue competitive advantage. Whether efforts to fully enforce taxes are worthwhile depends on the rate of compliance in the absence of such efforts. In this paper, we show that an upper bound on pre-enforcement tax compliance can be obtained using market data on pre- and post-enforcement periods. To do this, we estimate the pass-through of tax enforcement agreements between Airbnb and state and local governments, which achieve full compliance at the point of sale. Using data on Airbnb listings across a number of U.S. metropolitan areas, as well as variation in enforcement agreements across time, location, and tax rate, we estimate that taxes are paid on no more than 24 percent of Airbnb transactions prior to enforcement. We also find that demand is inelastic, which drives several key insights: the economic burden of taxation disproportionately falls on renters, excess burden is very small, and tax enforcement is not an effective policy lever for interest groups seeking to reduce local Airbnb activity.