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Should the death tax die? And should it leave an inheritance?

Author

Listed:
  • Cassone, Alberto
  • Marchese, Carla

Abstract

In this paper we examine the possibility of earmarking inheritance taxes to the financing of a transfer to the poor, aimed at reducing the payoff from small crime and at fostering the fulfillment of basic social responsibilities. A simple model of a society in which there are two types of agents either supplying legal labor or participating in criminal activity is presented. The effects of the transfer are examined with reference to two policy designs and to attitudes toward risk\ of the agents. Financing the transfer through inheritance taxation may be advisable as a way of collecting the needed revenue from agents who are likely to maintain strong enough incentives to good.

Suggested Citation

  • Cassone, Alberto & Marchese, Carla, 2001. "Should the death tax die? And should it leave an inheritance?," POLIS Working Papers 22, Institute of Public Policy and Public Choice - POLIS.
    • Handle: RePEc:uca:ucapdv:22
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    References listed on IDEAS

    as
    1. Wane, Waly, 2001. "The optimal income tax when poverty is a public 'bad'," Journal of Public Economics, Elsevier, vol. 82(2), pages 271-299, November.
    2. Imrohoroglu, Ayse & Merlo, Antonio & Rupert, Peter, 2000. "On the Political Economy of Income Redistribution and Crime," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 41(1), pages 1-25, February.
    3. Louis Kaplow, 2000. "A Framework for Assessing Estate and Gift Taxation," NBER Working Papers 7775, National Bureau of Economic Research, Inc.
    4. Demougin, Dominique & Schwager, Robert, 2000. "Excess burden of criminality and redistribution," International Review of Law and Economics, Elsevier, vol. 20(3), pages 329-351, September.
    5. Imrohoroglu, Ayse & Merlo, Antonio & Rupert, Peter, 2000. "On the Political Economy of Income Redistribution and Crime," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 41(1), pages 1-25, February.
    6. Zeckhauser, Richard J, 1971. "Optimal Mechanisms for Income Transfer," American Economic Review, American Economic Association, vol. 61(3), pages 324-334, June.
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    More about this item

    Keywords

    Inheritance Tax; Crime; Wealth Transfers;
    All these keywords.

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
    • K42 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior - - - Illegal Behavior and the Enforcement of Law

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