channels through which the effects of capital tax cuts and increases in public spending on both pre- and post-college education …

observations on wage (skill premium) and wealth inequality. We find that the tax rate for high income agents is optimally the least … volatile and the tax rate for low income agents the least counter-cyclical. In contrast, the path of optimal taxes for the …

This paper undertakes a normative investigation of the quantitative properties of optimal tax smoothing in a business … finds it optimal to adjust labour income tax rates so that the average net returns to skilled and unskilled labour hours …

benevolent government, which cares equally about its citizens, to tax capital heavily and to subsidise labour; (ii) a Pareto …

that, relative to the other tax reforms, capital tax cuts lead to the highest aggregate welfare but are skill-biased and … labour, falls in the capital tax can result in welfare losses for unskilled workers, even in the absence of other frictions … show that including the transition period in the welfare evaluation lowers the inequality effects of capital tax reduc …

-run welfare effects of tax reforms assuming agent heterogeneity in capital holdings. Each of these market failures, independently …, results in welfare losses for at least a segment of the population, after a capital tax cut and a concurrent labour tax … increase. However, when combined in a realistic calibration to the UK economy, they imply that a capital tax cut will be Pareto …

The stylized facts suggest a negative relationship between tax progressivity and the skill premium from the early 1960s … until the early 1990s, and a positive one thereafter. They also generally imply rising tax progressivity, except for the … 1980s. In this paper, we ask whether optimal tax policy is consistent with these observations, taking into account the …

General Equilibrium model. This reflects the popular belief that interest groups compete for privileged transfers and tax … European macroeconomic experience. We also get quantitative evidence of the fraction of collected tax revenues grabbed by rent …