Abstracts » Government

Optimal taxation and spending in general competitive growth models

Article Abstract:

A theorem which suggests that the optimal long-run tax on capital income is zero and its relationship to human capital is examined through a simple, infinitely-lived representative agent model. The zero-tax result for capital is argued by the fact that physical and human capital are intermediate goods. The inverse elasticity rule from commodity tax theory also suggests a zero tax on capital income. The zero-tax result can be used for tax reform proposals since proposals for consumption taxes cannot be considered as consumption taxes since they do not provide for human capital investments and are incompatible with optimal tax theory.

Tax Law, Corporate Income Taxes, Models, Taxation, Economic development, Human capital, Capital

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On optimal non-linear taxation and public good provision in an overlapping generations economy

Article Abstract:

Optimal non-linear taxation of income from capital and labor is examined in a context where a durable public good is provided. Production efficiency is assessed and linked to justifications for taxation of capital income.

Public sector

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The share price effects of dividend taxes and tax imputation credits

Article Abstract:

Links between taxation of dividends, stock prices, and the cost of capital are examined in detail. The focus is on the US, with some comparisons made with other countries.

Dividends, Tax credits

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