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Optimal Linear Income Taxation with General Equilirrium Effects on Wages
| Content Provider | Semantic Scholar |
|---|---|
| Author | Allen, Franklin |
| Copyright Year | 2001 |
| Abstract | The paper argues that the endogeneity of wages may make a considerable difference to optimal linear tax rates. In this case there is not only the usual direct redistribution via the fiscal system but also the general equilibrium redistribution due to the change in wages. Depending on the elasticity of substitution of the production function and the labour supply elasticities these may be reinforcing or opposing. It is shown that the general equilibrium effect may plausibly outweigh the direct effect so that net redistribution to the lower paid involves a wage subsidy financed by a lump-sum tax. |
| File Format | PDF HTM / HTML |
| Alternate Webpage(s) | http://finance.wharton.upenn.edu/~allenf/download/Vita/optimal%20linear%20income.pdf |
| Language | English |
| Access Restriction | Open |
| Subject Keyword | Elasticity (data store) Endogeneity (econometrics) Ephrin Type-B Receptor 1, human Kind of quantity - Equilibrium Labor (Childbirth) Lumped element model Mass Effect Trilogy Nash equilibrium |
| Content Type | Text |
| Resource Type | Article |
