Political economy of Ramsey taxation
We study the dynamic taxation of capital and labor in the Ramsey model under the assumption that taxes and public good provision are decided by a self-interested politician who cannot commit to policies. We show that, as long as the politician is as patient as the citizens, the Chamley–Judd result o...
| Main Authors: | , , |
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| Other Authors: | |
| Format: | Article |
| Language: | en_US |
| Published: |
Elsevier B.V.
2011
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| Online Access: | http://hdl.handle.net/1721.1/61786 https://orcid.org/0000-0003-0908-7491 |
| _version_ | 1826188443515879424 |
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| author | Acemoglu, Daron Golosov, Mikhail Tsyvinski, Aleh |
| author2 | Massachusetts Institute of Technology. Department of Economics |
| author_facet | Massachusetts Institute of Technology. Department of Economics Acemoglu, Daron Golosov, Mikhail Tsyvinski, Aleh |
| author_sort | Acemoglu, Daron |
| collection | MIT |
| description | We study the dynamic taxation of capital and labor in the Ramsey model under the assumption that taxes and public good provision are decided by a self-interested politician who cannot commit to policies. We show that, as long as the politician is as patient as the citizens, the Chamley–Judd result of zero long-run taxes holds. In contrast, if the politician is less patient than the citizens, the best (subgame perfect) equilibrium from the viewpoint of the citizens involves long-run capital taxation. |
| first_indexed | 2024-09-23T07:59:43Z |
| format | Article |
| id | mit-1721.1/61786 |
| institution | Massachusetts Institute of Technology |
| language | en_US |
| last_indexed | 2024-09-23T07:59:43Z |
| publishDate | 2011 |
| publisher | Elsevier B.V. |
| record_format | dspace |
| spelling | mit-1721.1/617862022-09-30T01:33:09Z Political economy of Ramsey taxation Acemoglu, Daron Golosov, Mikhail Tsyvinski, Aleh Massachusetts Institute of Technology. Department of Economics Acemoglu, Daron Acemoglu, Daron We study the dynamic taxation of capital and labor in the Ramsey model under the assumption that taxes and public good provision are decided by a self-interested politician who cannot commit to policies. We show that, as long as the politician is as patient as the citizens, the Chamley–Judd result of zero long-run taxes holds. In contrast, if the politician is less patient than the citizens, the best (subgame perfect) equilibrium from the viewpoint of the citizens involves long-run capital taxation. National Science Foundation (U.S.) 2011-03-24T18:40:17Z 2011-03-24T18:40:17Z 2010-12 2010-08 Article http://purl.org/eprint/type/JournalArticle 0047-2727 http://hdl.handle.net/1721.1/61786 Acemoglu, Daron, Mikhail Golosov, and Aleh Tsyvinski. “Political economy of Ramsey taxation.” Journal of Public Economics In Press https://orcid.org/0000-0003-0908-7491 en_US http://dx.doi.org/10.1016/j.jpubeco.2010.10.014 forthcoming in the Journal of Public Economics Creative Commons Attribution-Noncommercial-Share Alike 3.0 http://creativecommons.org/licenses/by-nc-sa/3.0/ application/pdf Elsevier B.V. MIT web domain |
| spellingShingle | Acemoglu, Daron Golosov, Mikhail Tsyvinski, Aleh Political economy of Ramsey taxation |
| title | Political economy of Ramsey taxation |
| title_full | Political economy of Ramsey taxation |
| title_fullStr | Political economy of Ramsey taxation |
| title_full_unstemmed | Political economy of Ramsey taxation |
| title_short | Political economy of Ramsey taxation |
| title_sort | political economy of ramsey taxation |
| url | http://hdl.handle.net/1721.1/61786 https://orcid.org/0000-0003-0908-7491 |
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