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Efficient Subsidization of Human Capital Accumulation with Overlapping Generations and Endogenous Growth
Richter, Wolfram F. - 2010
This paper studies second-best policies in an OLG model in which endogenous growth results from human capital accumulation. When young, individuals decide on education, saving, and nonqualified labour. When old, individuals supply qualified labour. Growth equilibria are inefficient in...
Persistent link: https://www.econbiz.de/10013149817
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Redistribution and Insurance with Simple Tax Instruments
Findeisen, Sebastian - 2015
We analyze optimal taxation of labor and capital income in a life-cycle framework with idiosyncratic income risk. We … independent of the social welfare function and determined by the degree of income risk and risk aversion. The optimal linear … capital tax is non-zero and trades off redistribution and insurance against savings distortions. Our quantitative results …
Persistent link: https://www.econbiz.de/10013016371
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Sufficient Statistic or Not? The Elasticity of Taxable Income in the Presence of Deduction Possibilities
Dörrenberg, Philipp - 2014
The elasticity of taxable income (ETI) is often interpreted as a sufficient statistic to assess the welfare costs of taxation. Building on the conceptual framework of Chetty (2009), we show that this assertion does no longer hold for tax systems with deduction possibilities if (i) deductions...
Persistent link: https://www.econbiz.de/10013045052
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Education and Optimal Dynamic Taxation
Findeisen, Sebastian - 2011
We study optimal tax and educational policies in a dynamic private information economy, in which ex-ante heterogeneous individuals make an educational investment early in their life and face a stochastic wage distribution. We characterize labor and education wedges in this setting analytically...
Persistent link: https://www.econbiz.de/10013118777
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Optimal Piecewise Linear Income Taxation
Apps, Patricia F. - 2011
Given its significance in practice, piecewise linear taxation has received relatively little attention in the literature. This paper offers a simple and transparent analysis of its main characteristics. We fully characterize optimal tax parameters for the cases in which budget sets are convex...
Persistent link: https://www.econbiz.de/10013119548
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Mobility, Taxation and Welfare
Bibi, Sami - 2011
Income mobility is often thought to equalize permanent incomes and thereby to improve social welfare. The welfare analysis of mobility often fails, however, to account for the cost of the variability of periodic incomes around permanent incomes. This paper assesses the net welfare benefit of...
Persistent link: https://www.econbiz.de/10013123610
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Employment, Hours of Work and the Optimal Taxation of Low Income Families
Blundell, Richard W. - 2011
The optimal design of low income support is examined using a structural labour supply model. The approach incorporates unobserved heterogeneity, fixed costs of work, childcare costs and the detailed non-convexities of the tax and transfer system. The analysis considers purely Pareto improving...
Persistent link: https://www.econbiz.de/10013123920
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Tax Me If You Can! Optimal Nonlinear Income Tax between Competing Governments
Lehmann, Etienne - 2013
, extending the Diamond-Saez formula. The theory and numerical simulations on the US case show that the level and the slope of the …
Persistent link: https://www.econbiz.de/10013074211
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Accounting for Family Background When Designing Optimal Income Taxes : A Microeconometric Simulation Analysis
Aaberge, Rolf - 2009
The purpose of this paper is to introduce and adopt a generalised version of Roemer's (1998) Equality of Opportunity (EOp) framework, which we call extended EOp, for analysing second-best optimal income taxation. Unlike the pure EOp criterion of Roemer (1998) the extended EOp criterion allows...
Persistent link: https://www.econbiz.de/10013153308
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On the Optimality of a Minimum Wage : New Insights from Optimal Tax Theory
Hungerbühler, Mathias - 2007
We build a theoretical model to study whether a minimum wage can be welfare-improving if it is implemented in conjunction with an optimized nonlinear income tax. We consider this issue in a framework where search frictions on the labor market generate unemployment. Workers differ in...
Persistent link: https://www.econbiz.de/10012776136