Aigner, Rafael - Max-Planck-Institut zur Erforschung von … - 2011
This paper shows how the optimal level of Pigouvian taxation is influenced by distributive concerns. With second …-best instruments, a higher level of income redistribution calls for a lower level of Pigouvian taxation. More redistributionimplies … that tax collection via the income tax creates higher distortions, which in turn makes revenues from Pigouvian taxation …