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Optimal Labor Income Taxation under Maximin: An Upper Bound

Author

Listed:
  • Jacquet, Laurence

    (Dept. of Economics, Norwegian School of Economics and Business Administration)

Abstract

This paper assumes the standard optimal income tax model of Mirrlees (Review of Economic Studies, 1971). It gives fairly mild conditions under which the optimal nonlinear labor income tax profile derived under maximin has higher marginal tax rates than the ones derived with welfarist criteria that sum over the population any concave transformation of individual utilities. This strict dominance result is always valid close to the bounds of the skill distribution and almost everywhere (except at the upper bound) when quasilinear-in-consumption preferences are assumed.

Suggested Citation

  • Jacquet, Laurence, 2010. "Optimal Labor Income Taxation under Maximin: An Upper Bound," Discussion Paper Series in Economics 5/2010, Norwegian School of Economics, Department of Economics.
    • Handle: RePEc:hhs:nhheco:2010_005
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    Cited by:

    1. Oztek, Abdullah Selim, 2019. "A Characterization for Marginal Income Tax Schedules," MPRA Paper 103046, University Library of Munich, Germany, revised 02 Dec 2019.

    More about this item

    Keywords

    Optimal income taxation; maximin.;

    JEL classification:

    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation

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