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Optimal Capital Income Taxation
Optimal capital income taxation is a subarea of optimal tax theory which studies the design of taxes on capital income such that a given economic criterion like utility is optimized. Some have theorized that the optimal capital income tax is zero. Starting from the conceptualization of capital income as future consumption, the taxation of capital income corresponds to a differentiated consumption tax on present and future consumption. Consequently, a capital income tax results in the distortion of individuals' saving and consumption behavior as individuals substitute the more heavily taxed future consumption with current consumption. Due to these distortions, zero taxation of capital income might be optimal, a result postulated by the Atkinson–Stiglitz theorem (1976) and the Chamley–Judd zero capital income tax result (1985/1986). Subsequent work on optimal capital income taxation has elucidated the assumptions underlying the theoretical optimality of a zero capital income t ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Optimal Tax
Optimal tax theory or the theory of optimal taxation is the study of designing and implementing a tax that maximises a social welfare function subject to economic constraints. The social welfare function used is typically a function of individuals' utilities, most commonly some form of utilitarian function, so the tax system is chosen to maximise the aggregate of individual utilities. Tax revenue is required to fund the provision of public goods and other government services, as well as for redistribution from rich to poor individuals. However, most taxes distort individual behavior, because the activity that is taxed becomes relatively less desirable; for instance, taxes on labour income reduce the incentive to work. The optimization problem involves minimizing the distortions caused by taxation, while achieving desired levels of redistribution and revenue. Some taxes are thought to be less distorting, such as lump-sum taxes (where individuals cannot change their behaviour to redu ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Quarterly Journal Of Economics
''The Quarterly Journal of Economics'' is a peer-reviewed academic journal published by the Oxford University Press for the Harvard University Department of Economics. Its current editors-in-chief are Robert J. Barro, Lawrence F. Katz, Nathan Nunn, Andrei Shleifer, and Stefanie Stantcheva. History It is the oldest professional journal of economics in the English language, and covers all aspects of the field—from the journal's traditional emphasis on micro-theory to both empirical and theoretical macroeconomics. Reception According to the ''Journal Citation Reports'', the journal has a 2015 impact factor of 6.662, ranking it first out of 347 journals in the category "Economics". It is generally regarded as one of the top 5 journals in economics, together with the American Economic Review, Econometrica, the Journal of Political Economy, and the Review of Economic Studies. Notable papers Some of the most influential and well-read papers in economics have been published in th ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Optimal Labor Income Taxation
Optimal labour income tax is a sub-area of optimal tax theory which refers to the study of designing a tax on individual labour income such that a given economic criterion like social welfare is optimized. Efficiency-Equity tradeoff The modern literature on optimal labour income taxation largely follows from James Mirrlees' "Exploration in the Theory of Optimum Income Taxation". The approach is based on asymmetric information, as the government is assumed to be unable to observe the number of hours people work or how productive they are, but can observe individuals' incomes. This imposes incentive compatibility constraints that limit the taxes which the government is able to levy, and prevents it from taxing high-productivity people at higher rates than low-productivity people. The government seeks to maximise a utilitarian social welfare function subject to these constraints. It faces a tradeoff between efficiency and equity: * Higher levels of taxation on the rich create re ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Mirrlees Review
The Mirlees Review was a comprehensive review of the UK tax system undertaken in 2010, chaired by the Nobel laureate Sir James Mirrlees for the Institute for Fiscal Studies. The findings were launched in November 2010 and were published by Oxford University Press in two volumes. The report argued that it was possible for governments to raise the same revenues at significantly lower cost than the current system of taxation and submitted recommendations to support this notion. Panel The review panel members were: * Sir James Mirrlees * Stuart Adam * Timothy Besley * Richard Blundell * Stephen Bond * Robert Chote * Malcolm Gammie * Paul Johnson * Gareth Myles * James Poterba James Michael "Jim" Poterba, FBA (born July 13, 1958) is an American economist, Mitsui Professor of Economics at the Massachusetts Institute of Technology, and current NBER president and chief executive officer. Early years Poterba was born in ... Key Principles The report was based on the following key ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Journal Of Public Economics
The ''Journal of Public Economics'' is a monthly peer-reviewed academic journal covering public economics, with particular emphasis on the application of modern economic theory and methods of quantitative analysis. It provides a forum for discussion of public policy of interest to an international readership. It was established in 1972 by Tony Atkinson and is published by Elsevier. The current editors-in-chief are John Friedman (Brown University) and Wojciech Kopczuk (Columbia University). According to the ''Journal Citation Reports'', the journal has a 2019 impact factor The impact factor (IF) or journal impact factor (JIF) of an academic journal is a scientometric index calculated by Clarivate that reflects the yearly mean number of citations of articles published in the last two years in a given journal, as i ... of 2.218. References External links * Economics journals Elsevier academic journals Monthly journals Publications established in 1972 Public economics Englis ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Pareto Efficiency
Pareto efficiency or Pareto optimality is a situation where no action or allocation is available that makes one individual better off without making another worse off. The concept is named after Vilfredo Pareto (1848–1923), Italian civil engineer and economist, who used the concept in his studies of economic efficiency and income distribution. The following three concepts are closely related: * Given an initial situation, a Pareto improvement is a new situation where some agents will gain, and no agents will lose. * A situation is called Pareto-dominated if there exists a possible Pareto improvement. * A situation is called Pareto-optimal or Pareto-efficient if no change could lead to improved satisfaction for some agent without some other agent losing or, equivalently, if there is no scope for further Pareto improvement. The Pareto front (also called Pareto frontier or Pareto set) is the set of all Pareto-efficient situations. Pareto originally used the word "optimal" for t ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Second Welfare Theorem
There are two fundamental theorems of welfare economics. The first states that in economic equilibrium, a set of complete markets, with complete information, and in perfect competition, will be Pareto optimal (in the sense that no further exchange would make one person better off without making another worse off). The requirements for perfect competition are these: # There are no externalities and each actor has perfect information. # Firms and consumers take prices as given (no economic actor or group of actors has market power). The theorem is sometimes seen as an analytical confirmation of Adam Smith's "invisible hand" principle, namely that ''competitive markets ensure an efficient allocation of resources''. However, there is no guarantee that the Pareto optimal market outcome is socially desirable, as there are many possible Pareto efficient allocations of resources differing in their desirability (e.g. one person may own everything and everyone else nothing). The second th ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Aiyagari Model
Sudhakar Rao Aiyagari (November 9, 1951 – May 20, 1997) was an Indian-born economics professor at the University of Rochester. He had previous been a leading research economist at the Minneapolis Fed, prior to which he had taught, in the 1980s, at New York University, University of Wisconsin, Madison, and Carnegie-Mellon University in Pittsburgh. Aiyagari made significant contributions to the economics literature, primarily in the areas of macroeconomics, monetary theory and intertemporal general equilibrium theory. He died of a heart attack while playing tennis aged 45. Aiyagari held a doctorate in economics (received 1981) from the University of Minnesota and master's degrees in economics and physics from Jawaharlal Nehru University in New Delhi and the Indian Institute of Technology, Delhi The Indian Institute of Technology, Delhi is a public institute of technology located in New Delhi, India. It is one of the 23 IITs created to be Centres of Excellence for traini ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Market Failure
In neoclassical economics, market failure is a situation in which the allocation of goods and services by a free market is not Pareto efficient, often leading to a net loss of economic value. Market failures can be viewed as scenarios where individuals' pursuit of pure self-interest leads to results that are not efficient – that can be improved upon from the societal point of view.Paul Krugman and Robin Wells (2006). ''Economics'', New York, Worth Publishers. The first known use of the term by economists was in 1958, Francis M. Bator (1958). "The Anatomy of Market Failure," ''Quarterly Journal of Economics'', 72(3) pp351–379(press +). but the concept has been traced back to the Victorian philosopher Henry Sidgwick.Steven G. Medema (2007). "The Hesitant Hand: Mill, Sidgwick, and the Evolution of the Theory of Market Failure," ''History of Political Economy'', 39(3), p. 331€“358. 200Online Working Paper. Market failures are often associated with public goods, time-inconsistent ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
United States
The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territories, nine Minor Outlying Islands, and 326 Indian reservations. The United States is also in free association with three Pacific Island sovereign states: the Federated States of Micronesia, the Marshall Islands, and the Republic of Palau. It is the world's third-largest country by both land and total area. It shares land borders with Canada to its north and with Mexico to its south and has maritime borders with the Bahamas, Cuba, Russia, and other nations. With a population of over 333 million, it is the most populous country in the Americas and the third most populous in the world. The national capital of the United States is Washington, D.C. and its most populous city and principal financial center is New York City. Paleo-Americ ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Finland
Finland ( fi, Suomi ; sv, Finland ), officially the Republic of Finland (; ), is a Nordic country in Northern Europe. It shares land borders with Sweden to the northwest, Norway to the north, and Russia to the east, with the Gulf of Bothnia to the west and the Gulf of Finland across Estonia to the south. Finland covers an area of with a population of 5.6 million. Helsinki is the capital and largest city, forming a larger metropolitan area with the neighbouring cities of Espoo, Kauniainen, and Vantaa. The vast majority of the population are ethnic Finns. Finnish, alongside Swedish, are the official languages. Swedish is the native language of 5.2% of the population. Finland's climate varies from humid continental in the south to the boreal in the north. The land cover is primarily a boreal forest biome, with more than 180,000 recorded lakes. Finland was first inhabited around 9000 BC after the Last Glacial Period. The Stone Age introduced several differ ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Behavioral Economics
Behavioral economics studies the effects of psychological, cognitive, emotional, cultural and social factors on the decisions of individuals or institutions, such as how those decisions vary from those implied by classical economic theory. Behavioral economics is primarily concerned with the bounds of rationality of economic agents. Behavioral models typically integrate insights from psychology, neuroscience and microeconomic theory. The study of behavioral economics includes how market decisions are made and the mechanisms that drive public opinion. The concepts used in behavioral economics today can be traced back to 18th-century economists, such as Adam Smith, who deliberated how the economic behavior of individuals could be influenced by their desires. The status of behavioral economics as a subfield of economics is a fairly recent development; the breakthroughs that laid the foundation for it were published through the last three decades of the 20th century. Behavio ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
