Marginal Tax Reform, Externalities and Income Distribution

Inge Mayeres () and Stef Proost

Working Papers of Department of Economics, Leuven from KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven

Abstract: The paper examines welfare improving and revenue neutral directions marginal policy reforms for an economy with nonidentical individuals and an externality that has a feedback effect on the consumption of taxed goods. It considers three types of policy instruments: the indirect taxes, the uniform poll transfer and public abatement. This extends the framework set up by Ahmad and Stern (1984), Bovenberg and de Mooij (1994) and Schöb (1996). The theoretical model is illustrated for a specific externality, namely congestion caused by peak car transport.

Date: 1998-03
New Economics Papers: this item is included in nep-pub
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Citations: View citations in EconPapers (8)

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Journal Article: Marginal tax reform, externalities and income distribution (2001)
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Persistent link: https://EconPapers.repec.org/RePEc:ete:ceswps:ces9832

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