Heathcote, Jonathan; Storesletten, Kjetil; Violante, … - 2014 - This version: JANUARY 30, 2014
What shapes the optimal degree of progressivity of the tax and transfer system? On the one hand, a progressive tax … earnings risk. At the same time, progressivity reduces incentives to work and to invest in skills, and aggravates the …, and market structure parameters influence the optimal degree of progressivity. A calibration for the U.S. economy …