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Recent Advances in Optimal Income Taxation

  • Robin Boadway


    (Queen’s University)

This paper reviews recent contributions to the theory of optimal taxation, particularly those that are policy-relevant. These include refinements of the Mirrlees optimal income tax model, optimal redistribution when workers make labour decisions along the extensive margin, generalizations of the atkinson-Stiglitz and deaton Theorems on uniform commodity taxation, the implications of involuntary unemployment for redistribution and unemployment insurance, dynamic optimal taxation and the taxation of capital income, non-tax instruments for redistribution, and problems arising if preferences are heterogeneous.

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Article provided by IEF in its journal Hacienda Pública Española/Review of Public Economics.

Volume (Year): 200 (2012)
Issue (Month): 1 (March)
Pages: 15-39

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Handle: RePEc:hpe:journl:y:2012:v:200:i:1:p:15-39
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  1. Hungerbühler, Mathias & Lehmann, Etienne, 2007. "On the Optimality of a Minimum Wage: New Insights from Optimal Tax Theory," IZA Discussion Papers 2957, Institute for the Study of Labor (IZA).
  2. Laurence Jacquet & Etienne Lehmann & Bruno Van der Linden, 2010. "Optimal Redistributive Taxation with both Extensive and Intensive Responses," CESifo Working Paper Series 3308, CESifo Group Munich.
  3. BOADWAY, R. & MARCHAND, M. & PESTIEAU, P. & del MAR RACIONERO, M., 2001. "Optimal redistribution with heterogeneous preferences for leisure," CORE Discussion Papers 2001025, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  4. Gordon, Roger H. & Cullen, Julie Berry, 2012. "Income redistribution in a Federal system of governments," Journal of Public Economics, Elsevier, vol. 96(11), pages 1100-1109.
  5. Fleurbaey,Marc & Maniquet,François, 2011. "A Theory of Fairness and Social Welfare," Cambridge Books, Cambridge University Press, number 9780521715348, October.
  6. Camille Landais & Pascal Michaillat & Emmanuel Saez, 2013. "Optimal Unemployment Insurance over the Business Cycle," Discussion Papers 1303, Centre for Macroeconomics (CFM).
  7. Robin Boadway & Katherine Cuff, 1999. "Monitoring Job Search as an Instrument For Targeting Transfers," International Tax and Public Finance, Springer, vol. 6(3), pages 317-337, August.
  8. Tuomala, Matti, 1990. "Optimal Income Tax and Redistribution," OUP Catalogue, Oxford University Press, number 9780198286059.
  9. Jacquet, Laurence & Lehmann, Etienne & Van der Linden, Bruno, 2011. "Optimal Redistributive Taxation with Both Labor Supply and Labor Demand Responses," IZA Discussion Papers 5642, Institute for the Study of Labor (IZA).
  10. Katherine Cuff, 2000. "Optimality of workfare with heterogeneous preferences," Canadian Journal of Economics, Canadian Economics Association, vol. 33(1), pages 149-174, February.
  11. Manishi Prasad & Peter Wahlqvist & Rich Shikiar & Ya-Chen Tina Shih, 2004. "A," PharmacoEconomics, Springer Healthcare | Adis, vol. 22(4), pages 225-244.
  12. Lehmann, Etienne & Parmentier, Alexis & Van Der Linden, Bruno, 2011. "Optimal income taxation with endogenous participation and search unemployment," Journal of Public Economics, Elsevier, vol. 95(11), pages 1523-1537.
  13. Robin Boadway & Katherine Cuff, 1999. "A Minimum Wage can be Welfare-Improving and Employment-Enhancing," Working Papers 980, Queen's University, Department of Economics.
  14. Thomas F. Crossley & Hamish W. Low, 2005. "Borrowing Constraints, the Cost of Precautionary Saving, and Unemployment Insurance," Social and Economic Dimensions of an Aging Population Research Papers 125, McMaster University.
  15. Mathias Hungerb�hler & Etienne Lehmann & Alexis Parmentier & Bruno Van Der Linden, 2006. "Optimal Redistributive Taxation in a Search Equilibrium Model," Review of Economic Studies, Oxford University Press, vol. 73(3), pages 743-767.
  16. Chetty, Raj & Looney, Adam, 2006. "Consumption smoothing and the welfare consequences of social insurance in developing economies," Journal of Public Economics, Elsevier, vol. 90(12), pages 2351-2356, December.
  17. Chetty, Nadarajan, 2009. "Is the Taxable Income Elasticity Sufficient to Calculate Deadweight Loss? The Implications of Evasion and Avoidance," Scholarly Articles 9748527, Harvard University Department of Economics.
  18. Robin Boadway & Nicolas Marceau & Steeve Mongrain, 2007. "Redistributive Taxation under Ethical Behaviour," Scandinavian Journal of Economics, Wiley Blackwell, vol. 109(3), pages 505-529, 09.
  19. N. Gregory Mankiw & Matthew Weinzierl, 2010. "The Optimal Taxation of Height: A Case Study of Utilitarian Income Redistribution," American Economic Journal: Economic Policy, American Economic Association, vol. 2(1), pages 155-76, February.
  20. 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) 2003030, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  21. Hoon, H.T. & Phelps, E.S., 1998. "Low-Wage Employment Subsidies in a Labor-Turnover Model of the 'Natural Rate'," Papers 98-004, Indiana - Center for Econometric Model Research.
  22. Chetty, Raj, 2008. "Moral Hazard versus Liquidity and Optimal Unemployment Insurance," Scholarly Articles 9751256, Harvard University Department of Economics.
  23. Boadway, Robin & Gahvari, Firouz, 2006. "Optimal taxation with consumption time as a leisure or labor substitute," Journal of Public Economics, Elsevier, vol. 90(10-11), pages 1851-1878, November.
  24. Robin Boadway & Laurence Jacquet, 2006. "Optimal Marginal and Average Income Taxation under Maxi-min," Working Papers 1073, Queen's University, Department of Economics.
  25. Raj Chetty & Emmanuel Saez, 2008. "Optimal Taxation and Social Insurance with Endogenous Private Insurance," NBER Working Papers 14403, National Bureau of Economic Research, Inc.
  26. Juan Carlos Conesa & Sagiri Kitao & Dirk Krueger, 2007. "Taxing Capital? Not a Bad Idea After All!," NBER Working Papers 12880, National Bureau of Economic Research, Inc.
  27. Myles,Gareth D., 1995. "Public Economics," Cambridge Books, Cambridge University Press, number 9780521497695, October.
  28. Raj Chetty, 2008. "Erratum: Moral Hazard versus Liquidity and Optimal Unemployment Insurance," Journal of Political Economy, University of Chicago Press, vol. 116(6), pages 1197-1197, December.
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