Incentives, globalization, and redistribution

• 成果类型: Article
• 署名作者: Ferey, Antoine; Haufler, Andreas; Perroni, Carlo
• 署名单位: University of Munich; University of Munich; Leibniz Association; Ifo Institut; University of Warwick
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/j.jpubeco.2023.104920
• 发表日期: 2023
• 关键词: Performance contracts; market integration; redistributive taxation

摘要

We offer a new explanation for why taxes have become less redistributive in many countries while the concentration of incomes has increased. Our argument is based on the prevalence of incentive contracts in modern economies, in conjunction with increased product market integration. Globalization widens the spread of project returns and makes contract choices more responsive to tax changes. This can result in a lower optimal income tax rate while simultaneously increasing the income share of top earners. These results are confirmed in a calibrated version of our model based on U.S. income data. (c) 2023 Elsevier B.V. All rights reserved.