Capital Taxation under Political Constraints

• 成果类型: Article
• 署名作者: Scheuer, Florian; Wolitzky, Alexander
• 署名单位: Stanford University; Massachusetts Institute of Technology (MIT)
• 刊物名称: AMERICAN ECONOMIC REVIEW
• ISSN/ISSBN: 0002-8282
• DOI: 10.1257/aer.20141081
• 发表日期: 2016
• 页码: 2304-2328
• 关键词: income-distribution; dynamic theory; redistribution; ECONOMY; inconsistency; equilibrium; DISCRETION; insurance; rules; taxes

摘要

This paper studies optimal dynamic tax policy under the threat of political reform. A policy will be reformed ex post if a large enough coalition of citizens supports reform; thus, sustainable policies are those that will continue to attract enough political support in the future. We find that optimal marginal capital taxes are either progressive or U-shaped, so that savings are subsidized for the poor and/or the middle class but are taxed for the rich. U-shaped capital taxes always emerge when individuals' political behavior is purely determined by economic motives.