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

• 成果类型: Article
• 署名作者: Kroft, Kory; Kucko, Kavan; Lehmann, Etienne; Schmieder, Johannes
• 署名单位: University of Toronto; Boston University; Universite Paris-Pantheon-Assas; Swiss School of Public Health (SSPH+)
• 刊物名称: AMERICAN ECONOMIC JOURNAL-ECONOMIC POLICY
• ISSN/ISSBN: 1945-7731
• DOI: 10.1257/pol.20180033
• 发表日期: 2020
• 页码: 254-292
• 关键词: optimal redistributive taxation; macroeconomic approach; LABOR; insurance; elasticities; taxes; micro; EFFICIENCY; search

摘要

We derive a sufficient statistics tax formula in a model that incorporates unemployment and endogenous wages to study the shape of the optimal income tax. Key sufficient statistics are the macro employment response to taxation, the micro and macro participation response to taxation, and the wage-moderating effect of tax progressivity. We empirically implement the tax formula by estimating the micro and macro elasticities using policy variation from the United States. 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 ignored.