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Friday, July 31, 2020 | History

2 edition of Optimal income taxation found in the catalog.

Optimal income taxation

an example with a U-shaped pattern of optimal marginal tax rates

by Peter A. Diamond

  • 358 Want to read
  • 35 Currently reading

Published by Dept. of Economics, Massachusetts Institute of Technology in Cambridge, Mass .
Written in English


Edition Notes

StatementPeter Diamond
SeriesWorking paper / Dept. of Economics -- no. 94-14, Working paper (Massachusetts Institute of Technology. Dept. of Economics) -- no. 94-14.
The Physical Object
Pagination8 p. :
ID Numbers
Open LibraryOL24636709M
OCLC/WorldCa30758515

"On Income Distribution, Incentive Effects and Optimal Income Taxation," Review of Economic Studies, Oxford University Press, vol. 43(2), pages Diamond, Peter A, " Optimal Income Taxation: An Example with a U-Shaped Pattern of Optimal Marginal Tax Rates," American Economic Review, American Economic Association, vol. 88(1. Microeconomics of Taxation. This note provides a basic framework of public finance at the microeconomic level, starting from a general theory of taxation on commodity, income and corporate profits and then extending issues of tax evasion and compliance, and tax reform.

The book explains the differences in optimal redistributive tax systems when governments—instead of maximizing social welfare—minimize poverty or maximize social welfare based on rank order or charitable conservatism social welfare functions. The third set of extensions considers extending the Mirrlees income tax framework to allow for. This paper analyzes optimum income taxation in a model with endogenous job destruction that gives rise to unemployment. It is shown that optimal tax schemes comprise both payroll and layoff taxes.

An established view is that the revenue maximizing top tax rate for the US is approximately 73 percent. The revenue maximizing top tax rate is approximately 49 percent in a quantitative human capital model. The key reason for the lower top tax rate is the presence of two new forces not captured by the model [ ]. income pts = 9 GDP pts] In , top 1% incomes [>$K] paid average Fed individ-ual tax rate of \only" 22% Absent behavioral responses, increasing fed indiv tax rate on top 1% from 22% to 43% would raise revenue by 3 pts of GDP [$bn/year])Core optimal income tax problem: Top 1% has large po-.


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Optimal income taxation by Peter A. Diamond Download PDF EPUB FB2

Woodland, in Handbook of the Economics of Population Aging, The Taxation of Capital Income. An important strand of the literature on optimal taxation in dynamic economies concerns the proposition that the income tax rate on income from capital should be zero. This proposition was initiated by Judd (), who considered a closed economy producing a single product that could be.

Fleurbaey and Maniquet: Optimal Income Taxation Theory efforts and to neutralize the impact of exter-nal circumstances. Gaertner and Schokkaert () review the empirical social choice literature in which various notions of desert appear relevant in opinion surveys, and, fol-lowing an experimental approach, Cappelen.

Being a student of Nobel-prize winner James Mirrlees, Matti Tuomala has devoted large parts of his academic career to extending the Mirrlees () framework of optimal non-linear income taxation. He published a book on this topic in entitled Optimal Income Tax Author: Matti Tuomala.

Optimal Income Taxation Stefanie Stantcheva 1 GOALS OF THESE LECTURES 1) Understand the core optimal income tax model: linear and nonlinear taxes in the Saez () framework. General method, intuitive, sufficient statistics. 2) Introduce the mechanism design approach of Mirrlees (). Being a student of Nobel-prize winner James Mirrlees, Matti Tuomala has devoted large parts of his academic career to extending the Mirrlees () framework of optimal non-linear income taxation.

He published a book on this topic in entitled Optimal Income Tax and Redistribution (OUP). This new book provides a thorough and detailed Cited by: 8.

Optimal Redistributive Taxation Matti Tuomala. Presents the main and most important ideas in optimal taxation; Comprehensive coverage, from early literature to Mirrlees' most recent macro public finance. Optimal capital income taxation is a subarea of optimal tax theory which studies the design of taxes on capital income such that a given economic criterion like utility is optimized.

Some have theorized that the optimal capital income tax is zero. Starting from the conceptualization of capital income as future consumption, the taxation of capital income corresponds to a differentiated.

Optimal tax theory or the theory of optimal taxation is the study of designing and implementing a tax that maximises a social welfare function subject to economic constraints.

The social welfare function used is typically a function of individuals' utilities, most commonly some form of utilitarian function, so the tax system is chosen to maximise the aggregate of individual utilities. Lecture 2: Optimal Income Taxation Stefanie Stantcheva Fall 1 GOALS OF THIS LECTURE 1) Take a look at actual taxes and transfers in the U.S.

2) Understand the core optimal income tax model: linear and nonlinear taxes in the Saez () framework. General. come taxation, a distinction can be made between two methods for finding an optimal taxation: the primal and the dual approaches.

The primal approach consists in solving a centralized optimization problem for finding the optimal allocation with the tax policy implicit.

After this step the tax policy that implements the optimal allocation can be. Optimal Labor Income Taxation Thomas Piketty and Emmanuel Saez NBER Working Paper No. NovemberRevised December JEL No.

H21 ABSTRACT This paper reviews recent developments in the theory of optimal labor income taxation. We emphasize connections between theory and empirical work that were initially lacking from optimal income.

Stiglitz: w Pareto Efficient and Optimal Taxation and the New New Welfare Economics: Gordon and Li: w Tax Structure in Developing Countries: Many Puzzles and a Possible Explanation: Slemrod and Sorum: w The Compliance Cost of the U.S.

Individual Income Tax System: Slemrod and Yitzhaki: w The Optimal Size of a Tax Collection Agency: Auerbach: w The Theory of.

Mirrlees’ seminal paper on optimal nonlinear income taxation” (p. xviii). But Musgrave () and Atkinson and Stiglitz () are much more comprehensive in their coverage.

Get this from a library. The optimal income taxation of couples. [Henrik Jacobsen Kleven; Claus Thustrup Kreiner; Emmanuel Saez; National Bureau of Economic Research.] -- "This paper analyzes the optimal tax treatment of couples.

Each couple is modelled as a single rational economic agent supplying labour along two dimensions: primary and secondary earnings. Ability Commodity taxation Externalities Income taxation Labour supply Leisure Linear income tax Lump-sum taxes Marginal cost pricing Marginal tax rates Marginal utility of consumption Mirrlees, J.

Nonlinear income tax Optimal government policy Optimal tax systems Optimal taxation Pigouvian taxes Public goods Ramsey taxation Redistribution. This book is an excellent place to start if you don’t know the first thing about taxes. This isn't a mere laundry list of what you are eligible to deduct—it also teaches you how the law has recently evolved, which types of income are never taxed, how to claim things correctly, and how to read your financial records as a seasoned accountant would.

Being a student of Nobel-prize winner James Mirrlees, Matti Tuomala has devoted large parts of his academic career to extending the Mirrlees () framework of optimal non-linear income taxation. He published a book on this topic in entitled Optimal Income Tax and Redistribution (OUP).

This new book provides a thorough and detailed Reviews: 1. This book is a basic income tax text. I intend this text to be suitable for a three-hour course for a class comprised of law students with widely different back-grounds. Certain principles permeate all of tax law. I have found that certain axioms or principles will carry us a long way.

For example, income. Downloadable. This paper offers a quantitative exploration of optimal income tax design in the Mirrlees tradition, and asks how nearly simple parametric tax functions can decentralize constrained efficient allocations.

The environment features both observable and unobservable components of idiosyncratic labor productivity, and both public and private insurance. This chapter discusses the theory of optimal taxation, without including a discussion on the optimization of macro-economic models that are used to treat several aspects of public policy.

Information is considered as the central element in the theory. The discussion also includes two possible approaches in making well-based recommendations about public policy.

Optimal Income Tax and Redistribution book. Read reviews from world’s largest community for readers. This book provides a comprehensive survey of optimal.The standard theory of optimal taxation posits that a tax system should be chosen to maximize a social welfare function subject to a set of constraints.

The literature on optimal taxation typically treats the social planner as a utilitarian: that is, the social welfare function is .Once we replace the inappropriate all‐ income ETI of with a modest high‐ income ETI ofwhile keeping the same controversial Saez formula, that results in an optimal federal‐ state.