Fair Earnings Tax Reforms

Arbeitspapier

We characterize a measure of social welfare for linear production economies in which individuals differ in productive skills and preferences. The key feature of our measure is that it aggregates fairness gaps, defined as the difference between the money-metric utility that the individual currently obtains and the money-metric utility that the individual should obtain in a fair society. Social welfare depends on two normative parameters: society's aversion to unfairness and the degree to which society wants to compensate individuals for productivity differences. The latter parameter makes it possible to accommodate a whole range of ethical perspectives, from libertarianism to resource-egalitarianism. As an illustration, we use our social welfare measure to evaluate four hypothetical earnings tax reforms for Belgian singles. The degree of compensation for productivity differences turns out to be the most important normative choice for the overall evaluation, while allowing for involuntary unemployment is the most important empirical choice.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: CESifo Working Paper ; No. 10242

Klassifikation und Themen

• Klassifikation: Wirtschaft ; Distribution: General ; Welfare Economics: General ; Analysis of Collective Decision-Making: General ; Taxation, Subsidies, and Revenue: General ; Welfare, Well-Being, and Poverty: General ; Demand and Supply of Labor: General
• Thema: fairness ; money-metric utility ; excess burden ; unfair inequality ; earnings tax reforms ; involuntary unemployment

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Ooghe, Erwin ; Schokkaert, Erik ; Serruys, Hannes
• Ereignis: Veröffentlichung
• (wer): Center for Economic Studies and ifo Institute (CESifo)
• (wo): Munich
• (wann): 2023

Weitere Informationen

• Handle: http://hdl.handle.net/10419/271886
• Letzte Aktualisierung: 10.03.2025, 11:44 MEZ