A case for taxing education

We illustrate a novel informational feature of education, which the government may utilize. Discretionary decisions of individuals to acquire education may serve as an additional signal (to earned labor income) on the underlying unobserved innate earning ability, thereby mitigating the informational constraint faced by the government. We establish a case for taxing education, as a supplement to the labor income tax.

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Year of publication:	2005
Authors:	Blumkin, Tomer ; Sadka, Efraim
Publisher:	Munich : Center for Economic Studies and ifo Institute (CESifo)
Subject:	Schulfinanzierung \| Optimale Besteuerung \| Einkommensumverteilung \| Bildungsverhalten \| Signalling \| Bildungsertrag \| Theorie \| optimal taxation \| re-distribution \| education \| inequality

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Series:	CESifo Working Paper ; 1440
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Working Paper
Language:	English
Other identifiers:	485162237 [GVK] hdl:10419/18804 [Handle]
Classification:	D6 - Welfare Economics ; H2 - Taxation, Subsidies, and Revenue
Source:	EconStor

Persistent link: https://www.econbiz.de/10010261166