Compensation/responsibility theory requires that differences in individual outcomes which can be fully attributed to differences in underlying ‘compensation’ factors should be eliminated, while differences in outcomes caused by differential ‘responsibility’ factors should be preserved. To implement the theory, a ‘sharp’ cut between compensation and responsibility factors has to be made, which is often difficult in practice. In this note, we introduce a more .flexible ‘soft’ cut. - Based on a notion of partial compensation/responsibility - into a first-best income tax model à la Bossert (1995) and Bossert and Fleurbaey (1996). Two results emerge. First, we show that this ‘soft’ cut does not allow to escape the Bossert-Fleurbaey separability requirement of the gross income function. Second, we characterize a partial sharing rule-cum-separability as a natural candidate for partial redistribution.
|Date of creation:||Jul 2010|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +32-(0)16-32 67 25
Fax: +32-(0)16-32 67 96
Web page: http://www.econ.kuleuven.be/ew
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:ete:ceswps:ces10.21. 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: (Karla Vander Weyden)
If references are entirely missing, you can add them using this form.