Mattesini, Fabrizio; Rossi, Lorenza - Dipartimento di Scienze Economiche e Aziendali, … - 2010
We study the effects of progressive labor income taxation in an otherwise standard NK model. We show that progressive taxation (i) introduces a trade-off between output and inflation stabilization and affects the slope of the Phillips Curve; (ii) acts as automatic stabilizer changing the...
