Barro, Robert J.; Chari, Varadarajan V. - National Bureau of Economic Research - 2024
Chamley and Judd argued that optimal taxation dictates zero long-run tax rates on capital income, but Straub and Werning found that tax rates may be positive even in the steady state. These models feature a "period-zero problem" in the underlying Ramsey formulation, which omits past commitments...