consumption expenditures against the background of an incentive-compatible redistribution policy set by the central government …. Regional investment changes the productivity distribution in the economy, which aects the design of the optimal tax … the investment. Rich and poor regions both have strategic incentives to reduce investment which increases the productivity …

The Ramsey optimal taxation theory implies that the tax rate on capital income should be zero in the long run. This … reforms are modest. -- optimal taxation ; inequality ; redistribution …

capture serves as a redistribution tool when direct lump-sum transfers across regions are unfeasible. …

taxation be structured to improve productivity, incentivize innovation, and ultimately increase welfare? We study these … their productivity and are subject to collateral constraints. The stationary equilibrium features heterogeneous returns and … misallocation of capital. We show that increasing the wealth tax increases aggregate productivity. The gains result from the "use …

The Ramsey optimal taxation theory implies that the tax rate on capital income should be zero in the long run. This …