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Optimal Redistributive Taxation when Government’s and Agents’ Preferences Differ

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  • Blomquist, Sören

    (Department of Economics)

  • Micheletto, Luca

    (Department of Economics)

Abstract

Paternalism, merit goods and specific egalitarianism are concepts we sometimes meet in the literature. The thing in common is that the policy maker does not fully respect the consumer sovereignty principle and design policies according to some other criterion than individuals’ preferences. Using the self-selection approach to tax problems developed by Stiglitz (1982) and Stern (1982), the paper provides a characterization of the properties of an optimal redistributive mixed tax scheme in the general case when the government evaluates individuals’ well-being using a different utility function than the one maximized by private agents.

Suggested Citation

  • Blomquist, Sören & Micheletto, Luca, 2005. "Optimal Redistributive Taxation when Government’s and Agents’ Preferences Differ," Working Paper Series 2005:7, Uppsala University, Department of Economics.
    • Handle: RePEc:hhs:uunewp:2005_007
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    References listed on IDEAS

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    More about this item

    Keywords

    optimal taxation; behavioral economics; paternalism; merit goods; non-welfarism;
    All these keywords.

    JEL classification:

    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies

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