Uniform taxation and consumer preferences.
Diamond and Mirrlees (American Economic Review, 1971, 61, 8–27 and 261–278) showed that the first-order conditions for the Ramsey tax problem do not necessarily characterize tax optima. Researchers have since become cautious in using the first-order conditions. This paper establishes the validity of...
| Main Authors: | , |
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| Format: | Journal article |
| Language: | English |
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Elsevier
1995
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| _version_ | 1826264039551926272 |
|---|---|
| author | Besley, T Jewitt, I |
| author_facet | Besley, T Jewitt, I |
| author_sort | Besley, T |
| collection | OXFORD |
| description | Diamond and Mirrlees (American Economic Review, 1971, 61, 8–27 and 261–278) showed that the first-order conditions for the Ramsey tax problem do not necessarily characterize tax optima. Researchers have since become cautious in using the first-order conditions. This paper establishes the validity of a version of the first-order conditions, using them to determine when uniform taxation is optimal. We show Deaton's (Review of Economic Studies, 1979, 46, 391–405) conditions to be sufficient, but not necessary, for our problem. We also give a necessary and sufficient condition for uniform taxation to be optimal in terms of the wage-compensated supply of labor and a closed-form representation for preferences. |
| first_indexed | 2024-03-06T20:01:25Z |
| format | Journal article |
| id | oxford-uuid:276d92c3-7dd7-412c-8464-c18d884f9f0a |
| institution | University of Oxford |
| language | English |
| last_indexed | 2024-03-06T20:01:25Z |
| publishDate | 1995 |
| publisher | Elsevier |
| record_format | dspace |
| spelling | oxford-uuid:276d92c3-7dd7-412c-8464-c18d884f9f0a2022-03-26T12:06:51ZUniform taxation and consumer preferences.Journal articlehttp://purl.org/coar/resource_type/c_dcae04bcuuid:276d92c3-7dd7-412c-8464-c18d884f9f0aEnglishDepartment of Economics - ePrintsElsevier1995Besley, TJewitt, IDiamond and Mirrlees (American Economic Review, 1971, 61, 8–27 and 261–278) showed that the first-order conditions for the Ramsey tax problem do not necessarily characterize tax optima. Researchers have since become cautious in using the first-order conditions. This paper establishes the validity of a version of the first-order conditions, using them to determine when uniform taxation is optimal. We show Deaton's (Review of Economic Studies, 1979, 46, 391–405) conditions to be sufficient, but not necessary, for our problem. We also give a necessary and sufficient condition for uniform taxation to be optimal in terms of the wage-compensated supply of labor and a closed-form representation for preferences. |
| spellingShingle | Besley, T Jewitt, I Uniform taxation and consumer preferences. |
| title | Uniform taxation and consumer preferences. |
| title_full | Uniform taxation and consumer preferences. |
| title_fullStr | Uniform taxation and consumer preferences. |
| title_full_unstemmed | Uniform taxation and consumer preferences. |
| title_short | Uniform taxation and consumer preferences. |
| title_sort | uniform taxation and consumer preferences |
| work_keys_str_mv | AT besleyt uniformtaxationandconsumerpreferences AT jewitti uniformtaxationandconsumerpreferences |