search query: @indexterm taxation / total: 1872
reference: 381 / 1872
| Author: | Mar Racionero, M. del |
| Title: | Optimal tax mix with merit goods |
| Journal: | Oxford Economic Papers
2001 : OCT, VOL. 53:4, p. 628-641 |
| Index terms: | TAXATION NON-LINEAR MODELS COMMODITIES OPTIMIZATION |
| Language: | eng |
| Abstract: | This paper deals with optimal taxation in a two-class economy with two private commodities and labour. The authors derive optimal non-linear income and linear commodity taxes in the presence of merit goods. The authors formulate merit good arguments via a pathology of individual choice. The authors assume weak separability between consumption and leisure and show how the standard optimal tax results are modified due to merit good considerations. The authors address this issue in a finite-class economy because they believe this kind of setting allows for highly intuitive results. The authors' model is similar to the one deployed in Nava et al. Like them, the authors consider a standard two-person model of optimal taxation where the government cannot observe the agents' ability and uses both non-linear income and linear commodity taxes for redistribution. |
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