The incidence of a tax on pure rent in a small open economy
AbstractThis paper analyzes the effects of a land rent tax on capital formation and foreign investment in a life-cycle small open economy with endogenous labor-leisure choices. The consequences of land taxation critically depend on how the tax proceeds are used by the government. A land tax depresses capital formation, crowds out foreign investment and increases national wealth and consumption when the land tax revenues are distributed as lump-sum payments. If the proceeds from land taxation are used to finance unproductive government expenditure, the land tax will be neutral in its effects on the capital stock, nonhuman wealth and labor. When the tax revenues are used to reduce labor taxes, the land rent tax spurs nonhuman wealth accumulation and ambiguously affects the capital stock and labor.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Elsevier in its journal Journal of Public Economics.
Volume (Year): 90 (2006)
Issue (Month): 4-5 (May)
Contact details of provider:
Web page: http://www.elsevier.com/locate/inca/505578
Other versions of this item:
- Petrucci, Alberto, 2005. "The Incidence of a Tax on Pure Rent in a Small Open Economy," Economics & Statistics Discussion Papers esdp05025, University of Molise, Dept. EGSeI.
- E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
- E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
- H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Buiter, Willem H., 1989.
"Debt neutrality, Professor Vickrey and Henry George's 'single tax',"
Elsevier, vol. 29(1), pages 43-47.
- Willem H. Buiter, 1988. "Debt Neutrality, Professor Vickrey and Henry George's "Single Tax"," NBER Working Papers 2673, National Bureau of Economic Research, Inc.
- Hiroyuki Hashimoto & Masaya Sakuragawa, 1998. "Land-Tax, Transfer and Growth in an Endogenously Growing Economy with Overlapping Generations," The Japanese Economic Review, Japanese Economic Association, vol. 49(4), pages 412-425, December.
- Chamley, Christophe & Wright, Brian D., 1987. "Fiscal incidence in an overlapping generations model with a fixed asset," Journal of Public Economics, Elsevier, vol. 32(1), pages 3-24, February.
- Fane, George, 1984. "The Incidence of a Tax on Pure Rent: The Old Reason for the Old Answer," Journal of Political Economy, University of Chicago Press, vol. 92(2), pages 329-33, April.
- Laurence J. Kotlikoff & Lawrence H. Summers, 1986.
NBER Working Papers
1864, National Bureau of Economic Research, Inc.
- Jonathan Eaton, 1984.
NBER Working Papers
1512, National Bureau of Economic Research, Inc.
- Calvo, Guillermo A & Kotlikoff, Laurence J & Rodriguez, Carlos Alfredo, 1979.
"The Incidence of a Tax on Pure Rent: A New (?) Reason for an Old Answer,"
Journal of Political Economy,
University of Chicago Press, vol. 87(4), pages 869-74, August.
- Guillermo A. Galvo & Laurence J. Kotlikoff & Carlos Alfredo Rodriguez, 1978. "The Incidence of a Tax on Pure Rent: A New Reason for an Old Answer," UCLA Economics Working Papers 125, UCLA Department of Economics.
- Mills, David E., 2001. "Land value taxation," Regional Science and Urban Economics, Elsevier, vol. 31(6), pages 765-770, November.
- Feldstein, Martin S, 1977. "The Surprising Incidence of a Tax on Pure Rent: A New Answer to an Old Question," Journal of Political Economy, University of Chicago Press, vol. 85(2), pages 349-60, April.
- Olivier J. Blanchard, 1984.
"Debt, Deficits and Finite Horizons,"
NBER Working Papers
1389, National Bureau of Economic Research, Inc.
- Bentick, Brian L, 1979. "The Impact of Taxation and Valuation Practices on the Timing and Efficiency of Land Use," Journal of Political Economy, University of Chicago Press, vol. 87(4), pages 859-68, August.
- Ihori, Toshihiro, 1990. "Economic effects of land taxes in an inflationary economy," Journal of Public Economics, Elsevier, vol. 42(2), pages 195-211, July.
- Kangoh Lee, 2003. "Should land and capital be taxed at a uniform rate?," Canadian Journal of Economics, Canadian Economics Association, vol. 36(2), pages 350-372, May.
- Petrucci, Alberto, 2006. "Wealth Accumulation and Growth in a Specific-Factors Model of Trade and Finance," Economics & Statistics Discussion Papers esdp06029, University of Molise, Dept. EGSeI.
- Koethenbuerger, Marko & Poutvaara, Panu, 2009.
"Rent taxation and its intertemporal welfare effects in a small open economy,"
Munich Reprints in Economics
19461, University of Munich, Department of Economics.
- Marko Koethenbuerger & Panu Poutvaara, 2009. "Rent taxation and its intertemporal welfare effects in a small open economy," International Tax and Public Finance, Springer, vol. 16(5), pages 697-709, October.
- Marko Köthenbürger & Panu Poutvaara, 2007. "Rent Taxation and its Intertemporal Welfare Effects in a Small Open Economy," CESifo Working Paper Series 2158, CESifo Group Munich.
- Coulson, N. Edward & Li, Herman, 2010. "The effect of risk on the effect of a land tax: A simulation," Regional Science and Urban Economics, Elsevier, vol. 40(6), pages 530-537, November.
- Ottmar Edenhofer & Linus Mattauch & Jan Siegmeier, 2013. "Hypergeorgism: When is Rent Taxation as a Remedy for Insufficient Capital Accumulation Socially Optimal?," CESifo Working Paper Series 4144, CESifo Group Munich.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.