Golosov, Mikhail; Tsyvinski, Aleh; Werquin, Nicolas - National Bureau of Economic Research (NBER) - 2014
We develop a general method to study the effects of non-linear taxation in dynamic settings using variational arguments … decompose the gains arising from each element of tax reform, starting from a simple baseline system, as the available tax … instruments becomes more sophisticated. We further show that the design of tax systems obeys a common general principle, namely …