Uhlig, H.F.H.V.S. - Tilburg University, Center for Economic Research - 1997
variable capital stock. We then introduce capital income taxation and show, for example, that permanent defcits are feasible in …If a government imposes a tax on capital income, it may, as a result, lower the private rate of return on capital below … the case of a variable capital stock, provided the capital income tax is sufficiently high. We examine the welfare effects …