lifetime earnings risk. Based on a dynamic life-cycle model, we find that redistribution through the tax-and -transfer system … risk. Progressive taxation of annual earnings provides little insurance against lifetime earnings risk. The lifetime … insurance effects of taxation may be improved by moving to a progressive tax on lifetime earnings. Similarly, the lifetime …

We analyze optimal taxation of labor and capital income in a life-cycle framework with idiosyncratic income risk. We … provide a novel decomposition of labor income tax formulas into a redistribution and an insurance component. The latter is … capital tax is non-zero and trades off redistribution and insurance against savings distortions. Our quantitative results …

This paper develops a simulation model in order to examine the effectiveness of state attempts at redistribution under …-level redistribution are substantial, but state action may still be preferred to a federal policy that is at odds with preferences of a … state pursuing additional redistribution, but not a cost at the national level. -- fiscal federalism ; income redistribution …

method to find the optimal tax schedule. Applied to the optimal taxation of couples, we find that optimal isotax curves are …

If redistribution is distortionary, and if the income of skilled workers is due to knowledgeintensive activities and … reduction reduces statis inefficiency. On the other hand, standard redistribution also reduces the level of R and D because it … that standard redistribution always dominates limitations to IPRs. …

This paper investigates a previously unexplored behavioral response to taxation: whether smokers compensate for higher …