The optimal income tax when poverty is a public 'bad'

• 成果类型: Article
• 署名作者: Wane, W
• 署名单位: The World Bank
• 刊物名称: JOURNAL OF PUBLIC ECONOMICS
• ISSN/ISSBN: 0047-2727
• DOI: 10.1016/S0047-2727(00)00143-2
• 发表日期: 2001
• 页码: 271-299
• 关键词: poverty; income taxation

摘要

Poverty is considered as an aggregate negative externality that may affect people differently depending on their aversion to poverty. If society is on average averse to poverty, then the optimal income tax schedule displays negative marginal tax rates at least for the less skilled individuals. Negative marginal tax rates play the role of a Pigouvian earnings subsidy and foster the supply of labor of poor individuals. The no-distortion at the endpoints result which is therefore violated can be restored once the focus is shifted from individual to social distortions. (C) 2001 Elsevier Science B.V. All rights reserved.