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Optimal factor taxation under wage bargaining: a dynamic perspective

Koskela, Erkki; von Thadden, Leopold - 2002

We consider the issue of steady-state optimal factor taxation in a Ramsey-type dynamic general equilibrium setting with two distinct distortions: i) taxes on capital and labour are the only available tax instruments for raising revenues, and ii) labour markets are subject to a static...

Persistent link: https://www.econbiz.de/10010295746

Why are capital income taxes so high?

Flodén, Martin - 2006

The Ramsey optimal taxation theory implies that the tax rate on capital income should be zero in the long run. This … reform that is funded mostly by higher taxes on labor income while households with little wealth would prefer a reform that … is funded mostly by high taxes on initial wealth. Pareto improving reforms typically exist, but the welfare gains of such …

Persistent link: https://www.econbiz.de/10010281227

Optimal taxation and redistribution in a two sector two class agents' economy

Selim, Sheikh - 2011

We examine the optimal taxation problem in a two sector neoclassical economy with workers and capitalists. We show that in a steady state of this economy the optimal policy may involve a capital income tax or subsidy, differential taxation of labour income and redistribution. The level and the...

Persistent link: https://www.econbiz.de/10010288859

On the desirability of taxing capital income to reduce moral hazard in social insurance

Jacobs, Bas; Schindler, Dirk - 2009

This paper analyzes optimal linear taxes on labor income and savings in a standard two-period life-cycle model with endogenous leisure demands in both periods and non-insurable income risks. Households are subject to skill shocks in both periods of the life-cycle. We allow for completely general...

Persistent link: https://www.econbiz.de/10010266030

Time-consistent fiscal policy under heterogeneity: Conflicting or common interests?

Angelopoulos, Konstantinos; Malley, James R.; … - 2011

This paper studies the aggregate and distributional implications of Markov-perfect taxspending policy in a neoclassical growth model with capitalists and workers. Focusing on the long run, our main findings are: (i) it is optimal for a benevolent government, which cares equally about its...

Persistent link: https://www.econbiz.de/10010275851

Optimal factor income taxation in the presence of unemployment

Koskela, Erkki; Schöb, Ronnie - 2001

According to conventional wisdom internationally mobile capital should not be taxed or should be taxed at a lower rate than labour. An important underlying assumption behind this view is that there are no market imperfections, in particular that labour markets clear competitively. At least for...

Persistent link: https://www.econbiz.de/10010284989

Equilibrium security prices with capital income taxes and an exogenous interest rate

Rapp, Marc Steffen; Schwetzler, Bernhard - 2008

tool to transfer wealth from capital market participants to non-market participants, the level of the statutory tax rate is …

Persistent link: https://www.econbiz.de/10010305709

Fiscal policy, economic integration and unemployment

Eggert, Wolfgang; Goerke, Laszlo - 2003

In this paper fiscal policy is examined for an open economy characterised by unemployment due to efficiency wages. We allow for capital and firm mobility in a model where the government chooses the level of wage, source-based capital and profit taxation. The taxing choices of governments are...

Persistent link: https://www.econbiz.de/10010261641

Should we subsidize longevity?

Leroux, Marie-Louise; Pestieau, Pierre; Ponthiere, Grégory - 2009

This paper studies the design of the optimal non linear taxation in an economy where longevity varies across agents, and depends on three factors: longevity genes, health investment and farsightedness. Provided earnings, farsightedness and genes are correlated, governmental intervention can be...

Persistent link: https://www.econbiz.de/10010264609

The case for a progressive tax: From basic research to policy recommendations

Diamond, Peter A.; Saez, Emmanuel - 2011

This paper presents the case for tax progressivity based on recent results in optimal tax theory. We consider the …

Persistent link: https://www.econbiz.de/10010277417