Most contributions to optimal tax theory have assumed that all prices, including that of leisure, are known with … paper begins with a discussion of the positive theory of wage taxation and labor supply under uncertainty. This is followed …

-household income insurance mechanism strongly biases upward the welfare losses from idiosyncratic wage risk as well as the desired …

facing uninsurable idiosyncratic labor income risk. The Ramsey government internalizes the general equilibrium feedback of … optimal aggregate saving rate is independent of income risk. The optimal time-invariant tax on capital is increasing in income … risk. Its sign depends on the extent of risk and on the Pareto weight of future generations. If the Ramsey tax rate that …

This paper studies Pareto-optimal risk-sharing arrangements in a private information economy with aggregate uncertainty … result can be extended to dynamic settings in the sense that, in this case, only savings need to be distorted, but not trades …

when households have preferences with high labor supply elasticity, make dynamic savings decisions, and policies have … labor productivity risk, show that it has a wealth distribution that matches the data well, and then use it to characterize …

optimally shares risks across generations exposes future generations to a share of the risk in physical capital returns. Such a … system reduces precautionary saving and increases the risk-bearing capacity of the economy. Under plausible conditions it … increases the riskless interest rate, lowers the price of physical capital, and reduces the risk premium on physical capital …

.S. savings behavior. The restrictions imposed by general equilibrium theory play an important role in arriving at each of these … characteristics of idiosyncratic labor market risk. We find that uncertainty distributed throughout the working years accounts for 40 …