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Voting over piece-wise linear tax methods

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  • MORENO-TERNERO, Juan D.

    (Universidad de Malaga, Spain; Universidad Pablo de Olavide, Seville, Spain; Université catholique de Louvain, CORE, B-1348 Louvain-la-Neuve, Belgium)

Abstract

We analyze the problem of choosing the most appropriate method for apportioning taxes in a democracy. We consider a simple theoretical model of taxation and restrict our attention to piece-wise linear tax methods, which are almost ubiquitous in advanced democracies world- wide. We show that if we allow agents to vote for any method within a rich domain of piece-wise linear methods, then a majority voting equilibrium exists. Furthermore, if most voters have income below mean income then each method within the domain can be supported in equilibrium.

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Bibliographic Info

Paper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers with number 2010080.

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Date of creation: 01 Dec 2010
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Handle: RePEc:cor:louvco:2010080

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Keywords: voting; taxes; majority; single-crossing; Talmud;

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Cited by:
  1. Słomczyński, Wojciech & Życzkowski, Karol, 2012. "Mathematical aspects of degressive proportionality," Mathematical Social Sciences, Elsevier, vol. 63(2), pages 94-101.

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