IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

Procedurally Fair Income Taxation Schemes

  • Herings P. Jean-Jacques
  • Predtetchinski A.

    (METEOR)

We study the implications of procedural fairness on income taxation. All taxation schemes areallowed for, up to the constraints implied by incentive compatibility and budget balance. Weformulate procedural fairness as a particular non-cooperative bargaining game and examine thestationary subgame perfect equilibria of the game. The equilibrium outcome is called taxequilibrium and is shown to be unique. Procedurally fair taxation schemes are defined as thetaxation schemes that result in the limit of tax equilibria when the probability that negotiationsbreak down converges to zero. The procedurally fair taxation scheme is shown to be unique. It isshown to correspond to the taxation scheme resulting from the Nash bargaining solution and leadsto full redistribution of income.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://digitalarchive.maastrichtuniversity.nl/fedora/objects/guid:9eefc39b-cd98-4293-beee-46bd6e962b1b/datastreams/ASSET1/content
Our checks indicate that this address may not be valid because: 401 Unauthorized. If this is indeed the case, please notify (Charles Bollen)


Download Restriction: no

Paper provided by Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR) in its series Research Memorandum with number 035.

as
in new window

Length:
Date of creation: 2011
Date of revision:
Handle: RePEc:unm:umamet:2011035
Contact details of provider: Postal: P.O. Box 616, 6200 MD Maastricht
Phone: +31 (0)43 38 83 830
Web page: http://www.maastrichtuniversity.nl/
Email:


More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Ariel Rubinstein, 2010. "Perfect Equilibrium in a Bargaining Model," Levine's Working Paper Archive 252, David K. Levine.
  2. John E. Roemer, 1997. "The Democratic Political Economy of Progressive Income Taxation," Discussion Papers 97-03, University of Copenhagen. Department of Economics.
  3. Gary E Bolton & Jordi Brandts & Axel Ockenfels, 2005. "Fair Procedures: Evidence from Games Involving Lotteries," Economic Journal, Royal Economic Society, vol. 115(506), pages 1054-1076, October.
  4. Seok-ju Cho & John Duggan, 2001. "Uniqueness of Stationary Equilibria in a one-Dimensional Model of Bargaining," Wallis Working Papers WP23, University of Rochester - Wallis Institute of Political Economy.
  5. Roth, Alvin E, 1985. "A Note on Risk Aversion in a Perfect Equilibrium Model of Bargaining," Econometrica, Econometric Society, vol. 53(1), pages 207-11, January.
  6. Imai, Haruo & Salonen, Hannu, 2000. "The representative Nash solution for two-sided bargaining problems," Mathematical Social Sciences, Elsevier, vol. 39(3), pages 349-365, May.
  7. Thomson, William, 2003. "Axiomatic and game-theoretic analysis of bankruptcy and taxation problems: a survey," Mathematical Social Sciences, Elsevier, vol. 45(3), pages 249-297, July.
  8. Hart, Sergiu & Mas-Colell, Andreu, 1996. "Bargaining and Value," Econometrica, Econometric Society, vol. 64(2), pages 357-80, March.
  9. Hannu Vartiainen & Klaus Kultti, 2007. "Multilateral Non-Cooperative Bargaining in a General Utility Space," Discussion Papers 19, Aboa Centre for Economics.
  10. Cardona, Daniel & Ponsati, Clara, 2007. "Bargaining one-dimensional social choices," Journal of Economic Theory, Elsevier, vol. 137(1), pages 627-651, November.
  11. Laruelle, Annick & Valenciano, Federico, 2007. "Bargaining in committees as an extension of Nash's bargaining theory," Journal of Economic Theory, Elsevier, vol. 132(1), pages 291-305, January.
  12. Herings, P. Jean-Jacques & Predtetchinski, Arkadi, 2011. "On the asymptotic uniqueness of bargaining equilibria," Economics Letters, Elsevier, vol. 111(3), pages 243-246, June.
  13. Herings P. Jean-Jacques & Predtetchinski Arkadi, 2011. "Procedurally Fair Taxation," Research Memorandum 024, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
  14. 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.
  15. Tasos Kalandrakis, 2004. "Regularity of Pure Strategy Equilibrium Points in a Class of Bargaining Games," Wallis Working Papers WP37, University of Rochester - Wallis Institute of Political Economy.
  16. Merlo, Antonio & Wilson, Charles A, 1995. "A Stochastic Model of Sequential Bargaining with Complete Information," Econometrica, Econometric Society, vol. 63(2), pages 371-99, March.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:unm:umamet:2011035. 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: (Charles Bollen)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.