Is there a demand for income tax progressivity?
Recently Marhuenda and Ortuno-Ortin (1995) have provided a popular support for progressivity theorem that says that a marginal progressive tax always defeats a marginal regressive tax as long as individuals vote for the tax scheme minimizing their tax liabilities and the median income is less than the mean income. In this paper we provide, under similar circumstances, a popular support for regressivity theorem according to which more marginal regressivity (or less marginal progressivity) can always defeat any existing tax scheme. This move towards more regressivity (or less progressivity) is supported by the extremes of the income distribution. Combining this result with Marhuenda and Ortuno-Ortin's result implies that vote cycling is inevitable and that the demand for progressivity cannot be established in the standard Downsian framework with self-interested voters.
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- Mitra, Tapan & Ok, Efe A. & Kockesen, Levent, 1998. "Popular support for progressive taxation and the relative income hypothesis," Economics Letters, Elsevier, vol. 58(1), pages 69-76, January.
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97-03, University of Copenhagen. Department of Economics.
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498, California Institute of Technology, Division of the Humanities and Social Sciences.
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- DE DONDER, Philippe & HINDRIKS, Jean, .
"The politics of progressive income taxation with incentive effects,"
CORE Discussion Papers RP
1673, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- De Donder, Philippe & Hindriks, Jean, 2003. "The politics of progressive income taxation with incentive effects," Journal of Public Economics, Elsevier, vol. 87(11), pages 2491-2505, October.
- Philippe De Donder & Jean Hindriks, 2000. "The Politics of Progressive Income Taxation with Incentive Effects," Working Papers 416, Queen Mary University of London, School of Economics and Finance.
- De Donner, P. & Hindriks, J., 2000. "The Politics of Progressive Income Taxation with Incentive Effects," Papers 00-542, Toulouse - GREMAQ.
- Marhuenda, Francisco & Ortuno-Ortin, Ignacio, 1995. "Popular support for progressive taxation," Economics Letters, Elsevier, vol. 48(3-4), pages 319-324, June.
- De Donder, Philippe & Le Breton, Michel & Truchon, Michel, 1998. "Choosing from a Weighted Tournament," Cahiers de recherche 9815, Université Laval - Département d'économique.
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- Young, H Peyton, 1990. "Progressive Taxation and Equal Sacrifice," American Economic Review, American Economic Association, vol. 80(1), pages 253-66, March.
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