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Rules, Politics and the Normative Analysis of Taxation

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Abstract

Taxation has been a much-discussed subject in the literature on economics and in writings on the role and meaning of the state. Over the centuries, many authors have put forward views of what qualifies as "good" taxation and what constitutes undesirable tax policy. Consensus on these issues has changed over time, depending on historical circumstances and prevailing modes of economic thinking. In this chapter, we look at analytical views that enjoy broad acceptance in the current literature on taxation. We call these views "rules" or "norms" of analysis. They represent patterns of thinking that have wide currency or that have become codified in the literature. The chapter describes eight of the most important rules or norms and then critically examines their validity in a framework that makes explicit allowance for collective choice. Our critique leads us to identify several shortcomings and limitations in existing patterns of thinking.

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  • Walter Hettich & Stanley L. Winer, 2000. "Rules, Politics and the Normative Analysis of Taxation," Carleton Economic Papers 00-12, Carleton University, Department of Economics, revised 2002.
    • Handle: RePEc:car:carecp:00-12
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    More about this item

    Keywords

    public economics; public finance; taxation; collective choice; rules;
    All these keywords.

    JEL classification:

    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • H0 - Public Economics - - General
    • H1 - Public Economics - - Structure and Scope of Government
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue

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