Cremer, Helmuth; Gahvari, Firouz - 2013 - May 2012, revised May 2013
The Ramsey tax problem examines the design of linear commodity taxes to collect a given tax revenue. This approach has been seriously challenged by Atkinson and Stiglitz (1976) who show that (under some conditions) an optimal income tax makes commodity taxes redundant. In the meantime, the...