Optimal taxation with capital accumulation and wage bargaining

This study examines optimal taxation in a unionized economy in which households save capital. The main findings are as follows. Judd?s (1985) and Chamley?s (1986) classical results of zero taxation on capital income holds. This is true independently of workers? savings behaviour or the capitalists? weight in the social welfare function. The steady-state optimal tax rates on wages and employment are specified. The consumption tax is needed for revenue raising purposes.

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Year of publication:	2003
Authors:	Palokangas, Tapio
Publisher:	Bonn : Institute for the Study of Labor (IZA)
Subject:	Optimale Besteuerung \| Investition \| Sparen \| Lohnbildung \| Gewerkschaftlicher Organisationsgrad \| Theorie \| wage settlement \| optimal taxation \| capital accumulation

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Series:	IZA Discussion paper series ; 966
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Working Paper
Language:	English
Other identifiers:	37746841X [GVK] hdl:10419/20202 [Handle]
Classification:	J51 - Trade Unions: Objectives Structure, and Effects ; H21 - Efficiency; Optimal Taxation
Source:	EconStor