This paper shows that capital-skill complementarity provides a quantitatively significant rationale to tax capital for … redistributive governments. The optimal capital income tax rate is 60%, which is significantly higher than the optimal rate of 48% in … an identically calibrated model without capital-skill complementarity. The skill premium falls from 1.9 to 1.67 along the …

The Ramsey optimal taxation theory implies that the tax rate on capital income should be zero in the long run. This … any other group in the economy. This paper demonstrates that although all households agree that capital income taxation … reform that is funded mostly by higher taxes on labor income while households with little wealth would prefer a reform that …

optimal to accompany the decline in labor share by raising capital taxes only if the labor share is falling because of a … institutional arrangements that are relevant for optimal taxation of capital income. A quantitative application to the U.S. economy … shows that soaring profit shares since the 1980's can justify a significantly increasing path of capital income taxes. …

externality lowers the steady state propensity to consume out of total wealth. The opposite holds for a constant labor … productivity decline is high (low). In contrast to previous results, the optimal steady state capital income tax is zero, in spite …

use of capital income tax, labor income tax and estate tax. The results of this analysis add to the conventional wisdom … about capital income taxation: while it is true that in the long run the estate tax rate should be set to zero, it is also … true that other capital income taxation is a usable policy tool even in the steady state. The other contribution of the …