IDEAS home Printed from https://ideas.repec.org/p/cpr/ceprdp/13059.html
   My bibliography  Save this paper

Politically feasible reforms of non-linear tax systems

Author

Listed:
  • Bierbrauer, Felix
  • Boyer, Pierre

Abstract

We present a conceptual framework for the analysis of politically feasible tax reforms. First, we prove a median voter theorem for monotonic reforms of non-linear tax systems. This yields a characterization of reforms that are preferred by a majority of individuals over the status quo and hence politically feasible. Second, we show that every Pareto-efficient tax system is such that moving towards lower tax rates for below-median incomes and towards higher rates for above median incomes is politically feasible. Third, we develop a method for diagnosing whether a given tax system admits reforms that are politically feasible and/or welfare-improving.

Suggested Citation

  • Bierbrauer, Felix & Boyer, Pierre, 2018. "Politically feasible reforms of non-linear tax systems," CEPR Discussion Papers 13059, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:13059
    as

    Download full text from publisher

    File URL: http://www.cepr.org/active/publications/discussion_papers/dp.php?dpno=13059
    Download Restriction: CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Brett, Craig & Weymark, John A., 2016. "Voting over selfishly optimal nonlinear income tax schedules with a minimum-utility constraint," Journal of Mathematical Economics, Elsevier, vol. 67(C), pages 18-31.
    2. Peichl Andreas & Pestel Nico & Siegloch Sebastian & Sommer Eric, 2014. "Bundestagswahlkampf 2013: Klientelpolitik durch Steuerreform?," Perspektiven der Wirtschaftspolitik, De Gruyter, vol. 15(2), pages 182-194, June.
    3. Nathaniel Hendren, 2014. "Efficient Welfare Weights," NBER Working Papers 20351, National Bureau of Economic Research, Inc.
    4. Olivier Bargain & Mathias Dolls & Dirk Neumann & Andreas Peichl & Sebastian Siegloch, 2011. "Tax-Benefit Systems in Europe and the US: Between Equity and Efficiency," CESifo Working Paper Series 3534, CESifo Group Munich.
    5. Mikhail Golosov & Aleh Tsyvinski & Nicolas Werquin, 2014. "A Variational Approach to the Analysis of Tax Systems," NBER Working Papers 20780, National Bureau of Economic Research, Inc.
    6. Thomas Blanchet & Juliette Fournier & Thomas Piketty, 2017. "Generalized Pareto Curves : Theory and Applications," Working Papers 201703, World Inequality Lab.
    7. Christiansen, Vidar & Jansen, Eilev S., 1978. "Implicit social preferences in the Norwegian system of indirect taxation," Journal of Public Economics, Elsevier, vol. 10(2), pages 217-245, October.
    8. J. A. Mirrlees, 1971. "An Exploration in the Theory of Optimum Income Taxation," Review of Economic Studies, Oxford University Press, vol. 38(2), pages 175-208.
    9. Stuart Adam & James Browne & David Phillips & Barra Roantree, 2017. "Frictions and taxpayer responses: evidence from bunching at personal tax thresholds," IFS Working Papers W17/14, Institute for Fiscal Studies.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Laurence Jacquet & Etienne Lehmann, 2017. "Optimal income taxation with composition effects," TEPP Working Paper 2017-04, TEPP.
    2. Anesi, Vincent & Bowen, T. Renee, 2018. "Policy Experimentation, Redistribution and Voting Rules," CEPR Discussion Papers 12797, C.E.P.R. Discussion Papers.
    3. Chirvi, Malte & Schneider, Cornelius, 2019. "Stated preferences for capital taxation - tax design, misinformation and the role of partisanship," arqus Discussion Papers in Quantitative Tax Research 242, arqus - Arbeitskreis Quantitative Steuerlehre.
    4. Felix Bierbrauer & Aleh Tsyvinski & Nicolas D. Werquin, 2017. "Taxes and Turnout," NBER Working Papers 24123, National Bureau of Economic Research, Inc.
    5. Stefan Steinerberger & Aleh Tsyvinski, 2019. "Tax Mechanisms and Gradient Flows," Papers 1904.13276, arXiv.org.

    More about this item

    Keywords

    Non-linear income taxation; optimal taxation; political economy; Tax Reforms;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cpr:ceprdp:13059. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.