EconPapers    
Economics at your fingertips  
 

Taxing Top CEO Incomes

Laurence Ales and Christopher Sleet

American Economic Review, 2016, vol. 106, issue 11, 3331-66

Abstract: We use a firm-CEO assignment framework to model the market for CEO effective labor. In the model's equilibrium, more talented CEOs match with and supply more effort to larger firms. Taxation of CEO incomes affects the equilibrium pricing of CEO effective labor and, hence, spills over and affects firm profits. Absent the ability to tax profits or a direct concern for firm owners, a standard prescription for high marginal income taxes emerges. However, given such an ability or concern, the optimal marginal tax rates are much lower.

JEL-codes: D31 H21 H24 L25 M12 M52 (search for similar items in EconPapers)
Date: 2016
Note: DOI: 10.1257/aer.20151093
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (17) Track citations by RSS feed

Downloads: (external link)
https://www.aeaweb.org/articles?id=10.1257/aer.20151093 (application/pdf)
https://www.aeaweb.org/articles/attachments?retrie ... sc0TZyQxW8qdaxdYyGRZ (application/zip)
https://www.aeaweb.org/articles/attachments?retrie ... _wz14k8I0qxluhE1Yu74 (application/pdf)
https://www.aeaweb.org/articles/attachments?retrie ... wojH0xKbmpUHmC1pGUoX (application/zip)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aea:aecrev:v:106:y:2016:i:11:p:3331-66

Ordering information: This journal article can be ordered from
https://www.aeaweb.org/journals/subscriptions

Access Statistics for this article

American Economic Review is currently edited by Esther Duflo

More articles in American Economic Review from American Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Michael P. Albert ().

 
Page updated 2022-12-26
Handle: RePEc:aea:aecrev:v:106:y:2016:i:11:p:3331-66