Optimal Mirrleesian taxation in non-competitive labor markets

Carlos Eugênio da Costa () and Lucas Maestri

No 775, FGV EPGE Economics Working Papers (Ensaios Economicos da EPGE) from EPGE Brazilian School of Economics and Finance - FGV EPGE (Brazil)

Abstract: We study optimal labor income taxation in non-competitive labor markets. Firms offer screening contracts to workers who have private information about their productivity. A planner endowed with a Paretian social welfare function tries to induce allocations that maximize its objective. We provide necessary and sufficient conditions for implementation of constrained efficient allocations using tax schedules. All allocations that are implementable by a tax schedule display negative marginal tax rates for almost all workers. Not all allocations that are implementable in a competitive setting are implementable in this noncompetitive environment.

Date: 2015-12
New Economics Papers: this item is included in nep-cta, nep-mic, nep-pbe and nep-pub
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Citations: View citations in EconPapers (4)

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Related works:
Journal Article: Optimal Mirrleesian taxation in non-competitive labor markets (2019)
Working Paper: Optimal Mirrleesian Taxation in Non-competitive Labor Markets (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:fgv:epgewp:775

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