Date of Original Version

2-18-2011

Type

Working Paper

Rights Management

All Rights Reserved

Abstract or Description

We study efficient nonlinear taxation of labor and capital in a dynamic Mirrleesian model incorporating political economy constraints. Policies are chosen sequentially over time, without commitment. Our main result is that the marginal tax on capital income is progressive, in the sense that richer agents face higher marginal tax rates.

Included in

Economics Commons

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