A Contribution to the Theory of Optimal Utilitarian Income Taxation
60 Pages Posted: 7 Mar 2007
There are 2 versions of this paper
A Contribution to the Theory of Optimal Utilitarian Income Taxation
A Contribution to the Theory of Optimal Utilitarian Income Taxation
Date Written: February 2007
Abstract
The paper provides a new formulation of the Mirrlees-Seade theorem on the positivity of the optimal marginal income tax, under weaker assumptions and in a more general model. The formulation of the theorem is independent of whether the model involves finitely many types or a continuous type distribution. The formal argument makes the underlying logic transparent, relating the mathematics to the economics and showing precisely how each assumption enters the analysis.
Note: A previous version of this paper can be found at: http://ssrn.com/abstract=869204
Keywords: Optimal Income Taxation, Utilitarian Welfare Maximization, Redistribution
JEL Classification: D63, H21
Suggested Citation: Suggested Citation
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