Arbeitspapier

Optimal Income Taxation with Unemployment and Wage Responses: A Sufficient Statistics Approach

zu Verbundenen Objekten

We derive a sufficient statistics optimal tax formula in a general model that incorporates unemployment and endogenous wages, to study the shape of the tax and transfer system at the bottom of the distribution. The sufficient statistics are the macro employment response to taxation and the micro and macro participation responses. We estimate these statistics using policy variation from the U.S. tax and transfer system. Our results suggest that the optimal tax more closely resembles a Negative Income Tax than an Earned Income Tax Credit relative to the case where unemployment and wage responses are not taken into account.

Sprache
Englisch

Erschienen in
Series: IZA Discussion Papers ; No. 9719

Klassifikation
Wirtschaft
Taxation and Subsidies: Efficiency; Optimal Taxation
Time Allocation and Labor Supply
Labor Demand
Thema
optimal income taxation
labor supply
labor demand

Ereignis
Geistige Schöpfung
(wer)
Kroft, Kory
Kucko, Kavan
Lehmann, Etienne
Schmieder, Johannes F.
Ereignis
Veröffentlichung
(wer)
Institute for the Study of Labor (IZA)
(wo)
Bonn
(wann)
2016

Handle
Letzte Aktualisierung
10.03.2025, 11:41 MEZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
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Objekttyp

  • Arbeitspapier

Beteiligte

  • Kroft, Kory
  • Kucko, Kavan
  • Lehmann, Etienne
  • Schmieder, Johannes F.
  • Institute for the Study of Labor (IZA)

Entstanden

  • 2016

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