The welfare loss from a capital income tax

A decomposition of the welfare loss from a capital income tax into its two components: the intertemporal (consuming today versus tomorrow) and the within-period or static (consuming durable versus nondurable goods). Its calculations, which use a calibrated life-cycle model with a representative consumer, suggest that ignoring the static distortion may lead to substantial underestimation of the total welfare loss.

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Year of publication:	1997
Authors:	Cai, Jinyong ; Gokhale, Jagadeesh
Published in:	Economic Review. - Federal Reserve Bank of Cleveland. - 1997, Q I, p. 2-10
Publisher:	Federal Reserve Bank of Cleveland
Subject:	Taxation

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Extent:	application/pdf
Type of publication:	Article
Language:	English
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005360801