Poschke, Markus; Kaymak, Baris; Bakis, Ozan - Society for Economic Dynamics - SED - 2012
We compute the optimal non-linear tax policy in a dynastic economy with unin- surable risk, where generations are linked by dynastic wealth accumulation and corre- lated incomes. Unlike earlier studies, we find that the optimal tax policy is moderately regressive. Regressive taxes lead to higher...