Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5101524 | Journal of Monetary Economics | 2017 | 27 Pages |
Abstract
A formula for the revenue maximizing top tax rate is derived as a function of three elasticities. The formula applies to static models and to steady states of dynamic models and is relevant for the top tax rate on any component of income. The formula is applied to several classic models. The application of the formula is also illustrated using a quantitative human capital model.
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Alejandro Badel, Mark Huggett,