Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
957464 | Journal of Economic Theory | 2008 | 17 Pages |
Abstract
Using the Mirrlees optimal income tax model under maximin, we derive fairly mild conditions for a decreasing marginal tax rate throughout the skill distribution with no bunching, a strictly concave tax function in income and a single-peaked average tax schedule. Assuming additive preferences and an isoelastic disutility of labor function, these tax profiles are implied by aggregate skills that are non-decreasing with the skill level. If preferences are quasilinear in leisure or in consumption, these tax profiles are also obtained under a large set of skill distributions.
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Authors
Robin Boadway, Laurence Jacquet,