Fiscal E en Geome y and he Two-Axis Fiscal F amewo k:
A Coo dina ed App oach o Ins i u ional Tension
Au ho : Jim Yongzhi Huang, CPA, TEP, LL.M (Tax Law), MBA
A ilia ion: C ossLab Ins i u e, Canada
1. Why a New Coo dina e F amewo k o Ins i u ions?
Mos empi ical wo k on inequali y, educa ion, axa ion, o mig a ion ea s ins i u ions as
backg ound con ex . Tax codes, school-bounda y ules, immig a ion egimes, us egula ions
and inhe i ance law appea as legal scene y: hey a e no ed, some imes summa ized, and hen
pushed o he ma gins so ha eg ession models can p oceed wi h amilia uni s—households,
es sco es, incomes, demog aphic indica o s.
In p ac ice, howe e , people do no encoun e “ he ax sys em” o “ he educa ion sys em” as
abs ac ions. They encoun e disc e e e en s: a eassessmen le e , a esidence audi , an
eligibili y check o a school dis ic , a delayed inhe i ance dis ibu ion, a mig a ion s a us
change. Each o hese e en s is igge ed by ule-based in e ac ions be ween public capi al and
p i a e capi al. Each lea es an adminis a i e ace, e en i ha ace is siloed in di e en
agencies and ju isdic ions.
This whi e pape p oposes a coo dina ed way o hink abou hese e en s and he sys ems ha
gene a e hem. I b ing oge he h ee s ands o wo k:
1. The Two-Axis Fiscal F amewo k – a coo dina e ep esen a ion o iscal posi ion in
e ms o c oss-ju isdic ional public capi al and in e gene a ional p i a e capaci y.
2. Ins i u ional Tension Analysis – a way o desc ibing how ules and esou ces pull
agains each o he a speci ic poin s in ha coo dina e space.
3. Fiscal E en Geome y – a me hod o ea ing ule- igge ed e en s as poin s, pa hs and
clus e s in he Two-Axis space, u ning ins i u ional beha io in o obse able geome y.
Huang_2025_Fiscal_E en _Geome …
Taken oge he , hese elemen s do no o e a new s o y abou a pa icula policy. They o e a
common coo dina e language o desc ibing how ax, mig a ion, educa ion and in e gene a ional
weal h sys ems join ly gene a e obse able e en s. The aim is no o eplace exis ing econome ic
ools, bu o gi e hem a mo e cohe en iscal s a e space o ope a e in.
2. The Two-Axis Fiscal F amewo k
The s a ing poin is delibe a ely simple. Ins ead o de ining inequali y o oppo uni y h ough
sec o -speci ic indica o s, he Two-Axis amewo k asks:
• Whe e does a uni si in ela ion o public capi al?
• Wha is i s ca ying capaci y in p i a e capi al ac oss gene a ions, a e ax?
To answe hese ques ions, I de ine a wo-dimensional iscal space:
• The X-axis ep esen s c oss-ju isdic ional iscal posi ion in p e- ax public capi al. This
includes ax esidence, ea y ne wo ks, eligibili y o public educa ion and heal hca e,
and o he ule-bound access o publicly unded goods. Mo ing along X means mo ing
ac oss iscal bo de s—be ween coun ies, p o inces, school dis ic s o bene i egimes—
while acking how ules s uc u e access o public capi al.
• The Y-axis ep esen s in e gene a ional ca ying capaci y o pos - ax p i a e capi al.
I cap u es he abili y o a household o amily o sus ain and ans e esou ces— h ough
sa ings, gi s, inhe i ances, us s, co po a e s uc u es, and o he ehicles—a e ax has
al eady done i s wo k.
A household, us , o amily o ice can he e o e be ep esen ed as a poin (𝑋𝑋,𝑌𝑌)in his iscal
space. The posi ion is no a mo al anking; i is a s a e a iable. Wha ma e s is no only whe e a
poin is a a gi en momen , bu how poin s mo e when ules i e.
This basic coo dina e sys em has se e al consequences:
• I p o ides a common s a e space o phenomena ha a e usually analyzed sepa a ely—
ax en o cemen , mig a ion decisions, school-bounda y s a egies, us planning,
philan h opic design.
• I ea s public capi al and p i a e capi al as in e ac ing coo dina es, no as sepa a e
“sec o s.”
• I allows esea che s o alk abou pa hs, ajec o ies and clus e s in he same space,
a he han s i ching oge he un ela ed indica o s.
In his sense, he Two-Axis amewo k is no a model o one policy p oblem; i is a map on
which many iscal policies can be plo ed and compa ed.
3. Ins i u ional Tension as a S a e-Dependen Rela ion
Once we ha e a coo dina e space, he nex ques ion is: wha does i mean o ins i u ions o be
“unde ension”?
In e e yday language, ension appea s when ules and esou ces pull in di e en di ec ions. A
amily may be o mally eligible o a public p og am bu lack he pos - ax capaci y o na iga e i .
A c oss-bo de us may be legal unde one ju isdic ion’s ax law bu s uc u ally exposed unde
ano he ’s an i-a oidance ules. A school bounda y may look neu al on a map bu channel pos -
ax housing and ui ion decisions in o na ow co ido s.
Wi hin he Two-Axis amewo k, I use ins i u ional ension o desc ibe si ua ions whe e:
• A uni ’s (𝑋𝑋,𝑌𝑌)posi ion is legal bu agile, because small changes in ules o
en o cemen p oduce la ge changes in e ec i e access o ca ying capaci y.
• Rules ac oss ju isdic ions do no align, c ea ing s ess poin s whe e households a e
o ced in o complex maneu e s simply o main ain s abili y.
• Adminis a i e p ac ices (such as audi s, e i ica ions, o eligibili y checks) a e in ensely
concen a ed in pa icula egions o he X–Y space, e en when o mal law is w i en o
be gene al.
Ins i u ional ension is no a scala numbe in his whi e pape . I is a way o alk abou how
igh ly coupled ules and capi al lows a e a speci ic egions o he coo dina e space. In
la e echnical wo k, his in ui ion can be o malized in o indices o es ima o s, bu he
concep ual co e is s aigh o wa d:
Whe e ules mul iply cons ain s ela i e o a ailable p i a e capaci y, ins i u ional ension is
high.
Whe e ules dis ibu e cons ain s p opo ionally o capaci y, ins i u ional ension is lowe .
By ancho ing ension in a sha ed X–Y coo dina e space, he amewo k makes i possible o
compa e:
• Di e en ax egimes’ ea men o simila amilies,
• Di e en school sys ems’ ea men o simila pos - ax capi al p o iles,
• Di e en mig a ion and esidence ules’ impac on c oss-bo de households and amily
o ices.
Ins i u ional ension, in o he wo ds, becomes a s a e-dependen p ope y o he iscal
geome y i sel , no jus a me apho .
Time-Indexed Pa ame e Calib a ion
Al hough he geome y o he X–Y amewo k emains s able— he X-axis ep esen ing c oss-
ju isdic ional posi ions in p e- ax public capi al and he Y-axis ep esen ing he in e gene a ional
ca ying capaci y o pos - ax p i a e capi al—i s applied pa ame e s canno be ea ed as s a ic.
ITI analysis depends on annually shi ing policy signals, egula o y upda es, and bo h global and
domes ic da a condi ions associa ed wi h a gi en iscal domain. Fo his eason, he e ec i e
posi ions along he X and Y axes equi e pe iodic adjus men .
In his whi e pape , only he concep ual geome y is p esen ed. The speci ic calib a ion
p ocedu es, weigh ing s uc u es, and ime- a ying sensi i i y unc ions used in applied o
comme cial se ings a e no de ailed he e.
4. Fiscal E en Geome y: E en s as Poin s in a S a e Space
I he Two-Axis amewo k is he map, and ins i u ional ension is a way o desc ibing p essu e
a di e en loca ions on ha map, hen Fiscal E en Geome y explains how he map ills wi h
poin s.
The p emise is simple:
• Fiscal sys ems— ax, mig a ion, educa ion, us and inhe i ance egimes—gene a e
disc e e e en s: ax ilings, eassessmen s, esidence changes, isa enewals, school-
bounda y checks, us dis ibu ions, inhe i ance igge s, and so on.
• Each ime such an e en occu s, i upda es a uni ’s posi ion in he X–Y space.
Huang_2025_Fiscal_E en _Geome …
Fo mally, we can hink o :
• A ule se 𝑅𝑅con aining ax, mig a ion, educa ion and us ules,
• A popula ion 𝑁𝑁, and
• An ini ial dis ibu ion 𝐹𝐹
0o posi ions o e he X–Y space,
which oge he gene a e a sequence o e en s {𝐸𝐸𝑖𝑖𝑖𝑖}, whe e 𝑖𝑖indexes uni s (e.g., households,
en i ies) and 𝑡𝑡indexes ime. Each e en leads o a new coo dina e (𝑋𝑋𝑖𝑖𝑖𝑖,𝑌𝑌
𝑖𝑖𝑖𝑖).
When we plo all hese pos -e en posi ions ac oss he popula ion and ac oss ime, we ob ain a
cloud o poin s in he X–Y plane. This cloud is no andom. I s shape e lec s:
• Clus e s: whe e ce ain ule–capi al in e ac ions epea equen ly ( o example, mid-
income households in bounda y-adjacen neighbo hoods subjec o epea ed add ess
e i ica ion).
• Densi y g adien s: whe e ins i u ional bo lenecks o unnels appea ( o example,
na ow co ido s h ough which c oss-bo de capi al mus pass o emain complian ).
• T ajec o ies: he pa hs ha speci ic uni s ace as hey mo e ac oss ju isdic ions and
gene a ions, some imes smoo hly, some imes ia ab up jumps a e audi s, legal changes,
o s uc u al ansac ions.
This is wha I e e o as Fiscal E en Geome y: he s udy o how ule- igge ed e en s
gene a e obse able geome y in he Two-Axis space.
Once e en s a e ep esen ed as poin s and pa hs, amilia ools om econome ics and da a
science can be used in a mo e cohe en way:
• Panel models can be in e p e ed as es ima o s o e pa hs in s a e space, a he han o e
disconnec ed co a ia es.
• E en -s udy and di e ence-in-di e ences designs can be e- amed in e ms o shocks
ha al e he geome y—changing densi ies, opening o closing co ido s, shi ing
clus e s.
• Syn he ic con ol me hods can be used no only o ma ch ou come pa hs, bu o ma ch
en i e egions o he X–Y s a e space unde di e en ule se s.
The goal is no o u n e e y social-science ques ion in o a geome y exe cise, bu o make
isible he unde lying s uc u e ha ules impose on iscal li e.
5. A Resea ch P og am, No Jus a Diag am
Taken oge he , he Two-Axis amewo k, ins i u ional ension analysis, and Fiscal E en
Geome y de ine mo e han a concep ual ske ch. They ou line a esea ch p og am wi h mul iple
laye s:
1. Concep ual laye
o Cla i y he de ini ions o p e- ax public capi al and pos - ax p i a e capaci y.
o Documen how speci ic legal ules— ax esidence es s, school-bounda y c i e ia,
us egula ions—map in o X–Y posi ions and ansi ions.
2. Measu emen laye
o De elop indica o s o ins i u ional ension in speci ic egions o he space,
e lec ing how igh ly ules bind ela i e o pos - ax capaci y.
o Encode adminis a i e e en s as s anda dized poin s, enabling c oss-da ase and
c oss-ju isdic ion compa ison.
3. Geome ic/econome ic laye
o Model how e en s popula e he X–Y space unde di e en ule se s, using
simula ion and empi ical da a.
o Iden i y s uc u al b eaks, clus e s and high- ension zones, wi h an eye owa d
index cons uc ion and compa a i e analysis.
4. Applied laye
o Use he amewo k o s udy conc e e ques ions:
How do c oss-bo de school admissions p ac ices in e ac wi h mig a ion
and ax ules?
How do amily o ices and us s ace ajec o ies h ough he X–Y space
as hey balance compliance, p i acy and in e gene a ional goals?
How do changes in en o cemen p ac ices eshape he geome y o
e e yday iscal li e?
Each o hese laye s can suppo mul iple disse a ions, a icles o monog aphs. In his whi e
pape , my aim is mo e modes : o make he s uc u al connec ion isible. The same coo dina e
space ha o ganizes he Two-Axis amewo k also unde lies ins i u ional ension and Fiscal
E en Geome y. They a e no sepa a e ideas; hey a e di e en aces o he same analy ic
cons uc ion.
6. Communica ion Wi hou Sel -Decla a ion
A p ac ical di icul y in in oducing any new amewo k is he o ical. I is nei he accu a e no
p oduc i e o an au ho o decla e ha a “new pa adigm” has been c ea ed. Pa adigms a e
ecognized in hindsigh , no p oclaimed in ad ance. Ye i is equally unhelp ul o desc ibe
genuinely new s uc u es as i hey we e mino a ia ions on exis ing models.
The app oach I ake he e is in en ionally modes in language and ambi ious in s uc u e:
• I do no claim ha he Two-Axis amewo k eplaces exis ing heo ies o inequali y o
educa ion. I claim ha i o e s a sha ed iscal s a e space on which many exis ing
app oaches can be e-plo ed.
• I do no claim ha ins i u ional ension o Fiscal E en Geome y a e inal answe s. I
claim ha hey show how ules, capi al and e en s can be ep esen ed in a cohe en
coo dina e language, sui able o u u e econome ic and quali a i e wo k.
• I do no claim owne ship o e e e y applica ion. I claim esponsibili y o a icula ing he
basic geome y and o cla i ying how i can be used.
This is why sho whi e pape s, concep no es and wo king pape s on open pla o ms such as
SSRN and Zenodo a e cen al o he p ojec . They allow he amewo k o be:
• Publicly isible, wi hou wai ing o leng hy e iew cycles,
• P ecisely documen ed, so ha u u e esea che s can build on o con es i , and
• In e nally cohe en , wi h each piece e e ing back o a common coo dina e
a chi ec u e.
7. Conclusion: F om Rules o Geome y
Tax law, mig a ion egimes, educa ion sys ems and in e gene a ional weal h s uc u es a e o en
ea ed as sepa a e domains, each wi h i s own discou se and me hods. Ye o households,
amilies and ins i u ions, hese sys ems a e expe ienced oge he , as in e wined cons ain s and
oppo uni ies ha un old o e ime.
By:
• Mapping c oss-ju isdic ional public capi al and in e gene a ional p i a e capaci y on o a
Two-Axis iscal space,
• Desc ibing ins i u ional ension as a s a e-dependen p ope y o ha space, and
• Rep esen ing ule- igge ed e en s as poin s and ajec o ies in Fiscal E en Geome y,
I aim o p o ide a coo dina e-based language o s udying ins i u ions as s a e spaces a he
han as s a ic backg ounds.
This whi e pape does no exhaus he amewo k. I is an in i a ion: o see iscal li e no only as
a sequence o na a i es and case s udies, bu as a geome y gene a ed by ules and capi al
mo ing h ough ime. The de ails—including o mal es ima o s, weigh ing schemes and index
cons uc ions—belong in echnical wo king pape s. He e, he ask is simple and mo e
undamen al: o show ha hese h ee pieces i oge he , and ha oge he hey open a cohe en ,
o iginal way o seeing.
