Mike Zabek, Senior Economist, Ph.D.

Personal Tax Decreases

Mike Zabek has written a paper entitled “Personal Tax Changes and Financial Well-Being: Evidence from the Tax Cuts and Jobs Act” that is co-authored with Christine Dobridge and Joanne Hsu. The paper shows that personal tax decreases had the plausibly causal effect of moving people into the highest category of financial well-being – living comfortably. Corroborating this finding, larger tax decreases made people more likely to own their own homes and less likely to have student debt. Larger tax decreases also led to increased account balances, more new accounts, and there is also some evidence that delinquencies fell. Overall, the paper shows that tax decreases improved financial well-being meaningfully and in a way that would be ambiguous in credit reports alone.

Mr- Zabel plans to work on other projects related to household finance, labor markets, and regional economics. One piece of previous work that he is eager to build on is “Local Ties in Spatial Equilibrium,” which shows the implications in a regional setting of the fact that the typical resident of an area where the population is stagnating was most likely born nearby, which is much different from a growing area. He is working on a similar project related to transfer spending in the U.S. to better understand how federal transfer programs affect local economies both cyclically and structurally.

Mike Zabek is a Senior Economist at the Federal Reserve Board where he works in the Division of Consumer and Community Affairs. At the Board, he has worked on the Survey of Household Economics and Decision-making including introducing new questions about job quality that appear in a recent Working Paper “What Makes a Job Better? Survey Evidence from Job Changers.” Another example of his policy work is “Women’s Labor Force Exits During COVID-19: Differences by Motherhood, Race, and Ethnicity,” which emerged from an analysis Mike did to inform policy deliberations in 2020 and 2021. Mr. Zabek has also contributed to the recent modernization of the Community Reinvestment Act -- a regulation designed to ensure that banks extend credit in ways that benefit low-income earners and small businesses. He received his PhD from the University of Michigan in 2018 where his fields were Labor and Macro.