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Age-dependent taxation and the optimal retirement benefit formula

  • Mathias Kifmann


    (Department of Economics, University of Konstanz)

This paper presents a comprehensive view of life-time taxation including both explicit taxation through the general tax system and implicit taxation via the retirement benefit formula. Individuals are heterogeneous with respect to productivity. It is shown that the optimal structure of age-dependent taxation can be characterized by a generalized Ramsey formula. Furthermore, the paper derives the optimal retirement benefit formula in the presence of the general tax system.

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Paper provided by Research Group Heterogeneous Labor, University of Konstanz/ZEW Mannheim in its series Working Papers of the Research Group Heterogenous Labor with number 04-20.

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Length: 23 pages
Date of creation: 13 Dec 2004
Date of revision:
Handle: RePEc:knz:hetero:0420
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  1. Michael Hoy & John Livernois & Chris McKenna & Ray Rees & Thanasis Stengos, 2011. "Mathematics for Economics," MIT Press Books, The MIT Press, edition 3, volume 1, number 0262015072, June.
  2. Mirrlees, James A, 1971. "An Exploration in the Theory of Optimum Income Taxation," Review of Economic Studies, Wiley Blackwell, vol. 38(114), pages 175-208, April.
  3. Andres Erosa & Martin Gervais, 2000. "Optimal taxation in life-cycle economies," Working Paper 00-02, Federal Reserve Bank of Richmond.
  4. Monika BÜTLER, 2000. "Tax-Benefit Linkages in Pension Systems (a note)," Cahiers de Recherches Economiques du Département d'Econométrie et d'Economie politique (DEEP) 00.20, Université de Lausanne, Faculté des HEC, DEEP.
  5. Gervais, Martin, 2009. "On the optimality of age-dependent taxes and the progressive U.S. tax system," Discussion Paper Series In Economics And Econometrics 0905, Economics Division, School of Social Sciences, University of Southampton.
  6. Robert Fenge & Silke Uebelmesser & Martin Werding, 2006. "On the Optimal Timing of Implicit Social Security Taxes Over the Life Cycle," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 62(1), pages 68-107, March.
  7. Lindbeck, Assar & Persson, Mats, 2002. "The Gains from Pension Reform," Seminar Papers 712, Stockholm University, Institute for International Economic Studies.
  8. Sinn, Hans-Werner, 2000. "Why a Funded Pension System is Useful and Why It is Not Useful," Munich Reprints in Economics 19859, University of Munich, Department of Economics.
  9. LOZACHMEUR, Jean-Marie, 2002. "Optimal age specific income taxation," CORE Discussion Papers 2002046, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  10. Matthias Wrede, 1999. "Pareto Efficient Pay-as-You-Go Pension Systems with Multi-Period Lives," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), Justus-Liebig University Giessen, Department of Statistics and Economics, vol. 219(3+4), pages 494-503, September.
  11. Robert Fenge & Silke Uebelmesser & Martin Werding, 2002. "Second-best Properties of Implicit Social Security Taxes: Theory and Empirical Evidence," CESifo Working Paper Series 743, CESifo Group Munich.
  12. Klaus Beckmann, 2000. "A Note on the Tax Rate implicit in Contributions to Pay-as-you-go Public Pension Systems," FinanzArchiv: Public Finance Analysis, Mohr Siebeck, Tübingen, vol. 57(1), pages 63-, September.
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