Rent taxation and its intertemporal effects in a small open economy
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Rent taxation and its intertemporal effects in a small open economy. / Köthenbürger, Marko; Poutvaara, Panu.
I: International Tax and Public Finance, Bind 16, Nr. 5, 2009, s. 697-709.Publikation: Bidrag til tidsskrift › Tidsskriftartikel › Forskning › fagfællebedømt
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TY - JOUR
T1 - Rent taxation and its intertemporal effects in a small open economy
AU - Köthenbürger, Marko
AU - Poutvaara, Panu
N1 - JEL classification: H22, E62, F02
PY - 2009
Y1 - 2009
N2 - Previous literature concludes that replacing wage taxation by taxes on a fixed factor or its rents benefits future generations. However, the effects of such steady-state gains on the transition generations have been left open. In this paper, we show that taxation of rents may also increase utility of the current generation provided tax revenues are earmarked to reduce wage taxes. In particular, a shift in the tax mix may yield an intergenerational Pareto-improvement when the initially prevailing tax mix is sufficiently skewed toward wage taxation.
AB - Previous literature concludes that replacing wage taxation by taxes on a fixed factor or its rents benefits future generations. However, the effects of such steady-state gains on the transition generations have been left open. In this paper, we show that taxation of rents may also increase utility of the current generation provided tax revenues are earmarked to reduce wage taxes. In particular, a shift in the tax mix may yield an intergenerational Pareto-improvement when the initially prevailing tax mix is sufficiently skewed toward wage taxation.
KW - Faculty of Social Sciences
KW - rent taxes
KW - capitalization
KW - transitional dynamics
KW - labor supply
KW - asset prices
U2 - 10.1007/s10797-008-9085-9
DO - 10.1007/s10797-008-9085-9
M3 - Journal article
VL - 16
SP - 697
EP - 709
JO - International Tax and Public Finance
JF - International Tax and Public Finance
SN - 0927-5940
IS - 5
ER -
ID: 12236716