Koskela, Erkki; Thadden, Leopold von - In: German Economic Review 9 (2008) 05, pp. 135-159
We consider the issue of steady-state optimal factor taxation in a Ramsey-type dynamic general equilibrium setting with two distinct distortions: (i) taxes on capital and labour are the only available tax instruments for raising revenues and (ii) labour markets are subject to an inefficiency...