Conesa, Juan Carlos; Kitao, Sagiri; Krueger, Dirk - In: American Economic Review 99 (2009) 1, pp. 25-48
We quantitatively characterize the optimal capital and labor income tax in an overlapping generations model with idiosyncratic, uninsurable income shocks and permanent productivity differences of households. The optimal capital income tax rate is significantly positive at 36 percent. The optimal...
