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Tagging and redistributive taxation

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  • Robin BOADWAY
  • Pierre PESTIEAU

Abstract

We study optimal redistributive taxes when the population can be disaggregated into tagged groups. Under reasonable circumstances, the tax system will be more redistributive in the tagged group with the higher proportion of high-ability persons. We extend the analysis to the case where the tag reflects differences in resources required to achieve a given level of utility. The compensation given for needs depends on whether the income tax structure is differentiated by needs groups.

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Bibliographic Info

Article provided by ENSAE in its journal Annals of Economics and Statistics.

Volume (Year): (2006)
Issue (Month): 83-84 ()
Pages: 123-147

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Handle: RePEc:adr:anecst:y:2006:i:83-84:p:05

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References

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  5. HAMILTON, Jonathan & PESTIEAU, Pierre, 2002. "Optimal income taxation and the ability distribution: implications for migration equilibria," CORE Discussion Papers, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) 2002036, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  6. BOADWAY, Robin & PESTIEAU, Pierre, . "Indirect taxation and redistribution: the scope of the Atkinson-Stiglitz theorem," CORE Discussion Papers RP, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) -1647, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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  9. Laurence, JACQUET & Bruno, VAN DER LINDEN, 2003. "The Normative Analysis of ‘Tagging’ Revisited : Dealing with Stigmatization," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales), Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES) 2003030, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
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  14. CREMER, Helmuth & PESTIEAU, Pierre & ROCHET, Jean-Charles, 1999. "Direct versus indirect taxation: the design of the tax structure revisited," CORE Discussion Papers, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) 1999010, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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Citations

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Cited by:
  1. Brett, Craig & Weymark, John A., 2008. "The impact of changing skill levels on optimal nonlinear income taxes," Journal of Public Economics, Elsevier, Elsevier, vol. 92(7), pages 1765-1771, July.
  2. Craig Brett & John Weymark, 2008. "Optimal Nonlinear Taxation of Income and Savings without Commitment," Vanderbilt University Department of Economics Working Papers, Vanderbilt University Department of Economics 0805, Vanderbilt University Department of Economics.
  3. Brett, Craig, 2008. "The effects of population aging on optimal redistributive taxes in an overlapping generations model," MPRA Paper 8585, University Library of Munich, Germany.
  4. Kanbur, Ravi & Tuomala, Matti, 2014. "Groupings and the Gains From Tagging," Working Papers, Cornell University, Department of Applied Economics and Management 180142, Cornell University, Department of Applied Economics and Management.
  5. Bastani, Spencer & Blomquist, Sören & Micheletto, Luca, 2010. "Public Provision of Private Goods, Tagging and Optimal Income Taxation with Heterogeneity in Needs," Working Paper Series, Center for Fiscal Studies, Uppsala University, Department of Economics 2010:14, Uppsala University, Department of Economics.
  6. Leung, Tin Cheuk & Yazici, Hakki, 2011. "On the Optimal Skill Distribution in a Mirrleesian Economy," MPRA Paper 32596, University Library of Munich, Germany.
  7. Laurence JACQUET & Etienne LEHMANN, 2014. "Optimal Nonlinear Income Taxation with Multidimensional Types: The Case with Heterogeneous Behavioral Responses," THEMA Working Papers, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise 2014-01, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
  8. Craig Brett & John A. Weymark, 2004. "Public Good Provision and the Comparative Statics of Optimal Nonlinear Income Taxation," Vanderbilt University Department of Economics Working Papers, Vanderbilt University Department of Economics 0415, Vanderbilt University Department of Economics.
  9. CREMER, Helmuth & GAHVARI, Firouz & PESTIEAU, Pierre, . "Accidental bequests: a curse for the rich and a boon for the poor," CORE Discussion Papers RP, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) -2462, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  10. Matthew C. Weinzierl, 2012. "Why do we Redistribute so Much but Tag so Little? The principle of equal sacrifice and optimal taxation," NBER Working Papers 18045, National Bureau of Economic Research, Inc.
  11. Spencer Bastani, 2013. "Gender-based and couple-based taxation," International Tax and Public Finance, Springer, Springer, vol. 20(4), pages 653-686, August.
  12. Craig Brett & John A. Weymark, 2005. "Optimal Nonlinear Taxation of Income and Savings in a Two Class Economy," Vanderbilt University Department of Economics Working Papers, Vanderbilt University Department of Economics 0525, Vanderbilt University Department of Economics.
  13. Stuart Adam, 2005. "Measuring the marginal efficiency cost of redistribution in the UK," IFS Working Papers, Institute for Fiscal Studies W05/14, Institute for Fiscal Studies.

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