This Handbook entry presents a conceptual, normative overview of the subject of taxation. It emphasizes the … relationships among the main functions of taxation -- notably, raising revenue, redistributing income, and correcting externalities … -- and the mapping between these functions and various forms of taxation. Different types of taxation as well as expenditures …

, progressive taxation as well as investment and output subsidies to the entrepreneurial sector …

their growth performance. In our model, the effects of taxation on growth are highly non-linear. Low or moderate tax rates …

consider the evidence on taxation and growth for a large sample of countries. And finally, we use evidence from micro …

human capital formation. We show that national taxation can substantially affect long run growth rates. In particular, for … small open economies with substantial capital mobility, national taxation can readily lead to "development traps" (in which … influence of taxation on the rate of economic growth has important welfare implications: in basic endogenous growth models, the …