Should two-band income taxes be progressive given a general income distribution? We provide a negative answer under utilitarian and max-min welfare functions. While this result clarifies some ambiguities in the literature, it does not rule out progressive taxes in general. If we maximize total...

There is much evidence that relative income concern reduces subjective wellbeing and raises labour supply - "keeping up with the Joneses" (KUJ), while increasing use of social media and growing inequality encourage comparison. Models with one or two agent-types generally miss the policy relevant...