A Theory of Feasible Taxation in Advanced Democracies

Leonardo Baggiani () and Enrico Colombatto ()
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Enrico Colombatto: Department of Economics and Statistics (Dipartimento di Scienze Economico-Sociali e Matematico-Statistiche), University of Torino, Italy

No 33, Working papers from Department of Economics, Social Studies, Applied Mathematics and Statistics (Dipartimento di Scienze Economico-Sociali e Matematico-Statistiche), University of Torino

Abstract: Tax pressure is usually considered the result of the policymakers’ efforts to maximise public expenditure, possibly by resorting to populism in order to alleviate tensions among the taxpayers. This paper offers a different and more articulated approach, following which populism is exogenous in the short run, but may change in the long run; taxpayers are sensitive to the quality of public expenditure; and policymakers try to find a compromise between their desire to engage in rent-seeking and their electoral ambitions. This paper shows under which circumstances compromise is obtained, how tensions arise, and illustrates the categories of outcomes that the taxpayers’ reactions may generate.

Keywords: Part-time work; Horizontal and vertical part-time contracts; Flexible and elastic clauses; Firm total factor productivity (TFP); Semiparametric estimation methods. (search for similar items in EconPapers)
JEL-codes: J23 L23 L25 (search for similar items in EconPapers)
Pages: 18 pages
Date: 2015-11
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http://www.bemservizi.unito.it/repec/tur/wpapnw/m33.pdf First version, 2015 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:tur:wpapnw:033

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