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Optimal taxation, critical-level utilitarianism and economic growth

  • Spataro, Luca
  • Renström, Thomas I.

We analyze tax policies in an intertemporal economy with endogenous fertility under critical-level utilitarianism, both from a positive and a normative standpoint. On the positive side, we analyze the effects of a change in the tax on capital income and on fertility, both separately and combined so as to keep the per-capita public debt constant. On the normative side, we characterize the first- and second-best optimal tax structures, for both exogenous and endogenous labor supply.

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Article provided by Elsevier in its journal Journal of Public Economics.

Volume (Year): 96 (2012)
Issue (Month): 9-10 ()
Pages: 727-738

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Handle: RePEc:eee:pubeco:v:96:y:2012:i:9:p:727-738
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/505578

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  1. Chamley, Christophe, 1986. "Optimal Taxation of Capital Income in General Equilibrium with Infinite Lives," Econometrica, Econometric Society, vol. 54(3), pages 607-22, May.
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  26. Basu, Parantap & Marsiliani, Laura & Renström, Thomas I, 2004. "Optimal Dynamic Taxation with Indivisible Labour," CEPR Discussion Papers 4190, C.E.P.R. Discussion Papers.
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