Nonlinear taxation in an economy with heterogeneous firms and heterogeneous households

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dc.contributor.authorBarro, Jorge
dc.contributor.authorBerkovich, Efraim
dc.contributor.orgJames A. Baker III Institute for Public Policy
dc.date.accessioned2017-11-28T17:20:57Z
dc.date.available2017-11-28T17:20:57Z
dc.description.abstractIn an economy with heterogeneous firms and heterogeneous consumers, we describe a general equilibrium where firm equity is priced by a supply and demand process. With a model robust to arbitrary, nonlinear tax functions, we investigate the efficiency of replacing the current U.S. tax regime with a policy of no corporate taxes and taxation of capital distributions to the household at progressive personal income tax rates. We find that this policy reduces wealth inequality and increases total welfare.
dc.identifier.citationBarro, Jorge and Berkovich, Efraim. "Nonlinear taxation in an economy with heterogeneous firms and heterogeneous households." (2017) James A. Baker III Institute for Public Policy: <a href="https://www.bakerinstitute.org/research/barro-working-paper/">https://www.bakerinstitute.org/research/barro-working-paper/</a>.
dc.identifier.urihttps://hdl.handle.net/1911/98865
dc.language.isoeng
dc.subjectheterogeneous households
dc.subjectheterogeneous firms
dc.subjectcapital taxation
dc.subjectasset-pricing in incomplete markets
dc.titleNonlinear taxation in an economy with heterogeneous firms and heterogeneous households
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