This paper studies Pareto-optimal risk-sharing arrangements in a private information economy with aggregate uncertainty …

potentially loss averse around their expected outcome make risky investments in education and we draw on optimal tax theory to … explore the design of policy. The model highlights the critical roles played by (i) the relationship between behavioural risk … preferences, standard risk aversion and labour supply behaviour, (ii) the risk properties of education, and (iii) the degree of …

We analyze optimal taxation of labor and capital income in a life-cycle framework with idiosyncratic income risk. We … independent of the social welfare function and determined by the degree of income risk and risk aversion. The optimal linear …

We study the optimal taxation of risk-free and excess capital income with heterogeneous rates of return, alongside an … optimal nonlinear earnings tax. Households can hold three assets: one risk-free, one risky but diversifiable, and one a … private investment with idiosyncratic risk whose expected return differs among households. Contrary to expectations, the …