Quantifying the Laffer curve on the continued activity tax in a dynastic framework

• 成果类型: Article
• 署名作者: Hairault, Jean-Olivier; Langot, Francois; Sopraseuth, Thepthida
• 署名单位: Universite Paris Saclay; Paris School of Economics; heSam Universite; Universite Pantheon-Sorbonne; University of Maine System; University of Maine Orono
• 刊物名称: INTERNATIONAL ECONOMIC REVIEW
• ISSN/ISSBN: 0020-6598
• DOI: 10.1111/j.1468-2354.2008.00497.x
• 发表日期: 2008
• 页码: 755-797
• 关键词: social-security; retirement; BEHAVIOR; RISK; accumulation; insurance; liquidity; income

摘要

It is argued that the tax on continued activity should be removed by implementing actuarially fair schemes. However, these schemes cannot fund the expected Social Security (SS) deficit. This article proposes to give individuals a fraction of the actuarially fair incentives in the case of postponed retirement. SS faces a trade-off between giving enough incentives to make individuals delay retirement and giving little increase in pensions in order to help finance its expected deficit. This trade-off is captured by a Laffer curve. Finally, when the SS system aims to maximize welfare, the optimal tax on postponed retirement is still strictly positive.