This book deals with the problems of redistribution if different kinds of taxes are used as instruments. It throws light on the equity, efficiency and insurance aspects of taxation, and treats the topic at a high theoretical level. Using two ordinal equity criteria, it is shown in the first part of the book that equity and efficiency cannot be reconciled in a general model. Even if in a more restricted model equitable states exist, they cannot be implemented using an income tax. Part two of the book scrutinizes the range for redistribution which remains in a first best world if there is imperfect information and only special signals can be observed such as labour supply, income, or both. The range of redistribution for these kinds of taxes is illustrated and compared. In part three, a situation under uncertainty where a tax works as an insurance is investigated. The structure of the optimal tax scheme for several welfare functions is explored. The results with respect to equity and the range of redistribution for different sorts of taxes are of particular interest. The approach to the subject is not really new, since standard microeconomic tools are used. The book's beneficial contribution lies in its presentation of new results with respect to the equity debate and to the incentive compatibility literature.
I Fairness and production.- 1.1 The model.- 1.2 Finite economies.- 1.3 Continuum economies.- 1.4 Income tax implementability.- 1.5 Proofs.- II Redistribution, observability and different tax systems.- 2.1 The model and first definitions.- 2.2 Finite economies.- 2.2.1 PO(?) versus PO(y).- 2.2.2 PO(y, ?) versus PO(?) and PO(y).- 2.2.3 Wage taxes T(n) and PO(n).- 2.3 Continuum economies.- 2.4 Proofs.- III Taxation as insurance.- 3.1 The model.- 3.2 First and second best solutions.- 3.3 Remarks.- 3.4 Proofs.- Appendix: The deterministic versus the stochastic model.- Final Remarks.- References.
Series: Lecture Notes in Economic and Mathematical Systems
Number Of Pages: 132
Publisher: SPRINGER VERLAG GMBH
Country of Publication: DE
Dimensions (cm): 24.41 x 16.99
Weight (kg): 0.24