A Note on Redistributive Taxation, Labor Supply, and National Income

Volker Grossmann

International Journal of Business and Economics, 2003, vol. 2, issue 1, 39-48

Abstract: This paper shows that redistributive taxation can raise per capita income provided that labor supply is sufficiently backward-bending at higher wage rates. Moreover, we study general equilibrium effects regarding work incentives for less able individuals. Finally, we show that optimal taxation typically requires per capita income to decrease with higher taxation at the margin.

Keywords: backward-bending labor supply; linear income tax; national income (search for similar items in EconPapers)
JEL-codes: H21 H31 (search for similar items in EconPapers)
Date: 2003
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Citations: View citations in EconPapers (3)

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