A Fundamental Objection to Tax Equity Norms: A Call for Utilitarianism

Louis Kaplow

No 4961, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Anti-utilitarian norms often are used in assessing tax systems. Two motivations support this practice. First, many believe utilitarianism to be insufficiently egalitarian. Second, utilitarianism does not give independent weight to other equitable principles, notably concerns that reforms may violate horizontal equity or result in rank reversals in the income distribution. This investigation suggests that a policy maker who believes in the Pareto principle -- that any reform preferred by everyone should be adopted - - cannot consistently adhere to any of these anti-utilitarian sentiments. Moreover, the affirmative case for utilitarian tax policy assessment is stronger than is generally appreciated.

JEL-codes: H21 (search for similar items in EconPapers)
Date: 1994-12
Note: PE
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (12)

Published as National Tax Journal, vol. 48, no. 4, pp. 497-514, (1995).

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