Taxing capital along the transition—Not a bad idea after all?

Hans Fehr () and Fabian Kindermann

Journal of Economic Dynamics and Control, 2015, vol. 51, issue C, 64-77

Abstract: This paper quantitatively characterizes optimal tax systems in a model of overlapping generations, when transitional cohorts are explicitly taken into account. We use the recent study of Conesa et al. (2009) as an example, but extend it by transitional dynamics. We furthermore develop a general and coherent way of aggregating welfare effects of different individuals and cohorts in the short- and the long-run. Our welfare measure includes the case of a utilitarian social welfare function, yet is not limited to this perspective.

Keywords: Stochastic OLG model; Precautionary savings; Intragenerational risk sharing and redistribution (search for similar items in EconPapers)
JEL-codes: C68 D91 H21 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (34)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:dyncon:v:51:y:2015:i:c:p:64-77

DOI: 10.1016/j.jedc.2014.09.024

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