Public Input Provision in an Optimal Income Tax Model

Mutsumi Matsumoto

FinanzArchiv: Public Finance Analysis, 2001, vol. 58, issue 1, 12-30

Abstract: This paper derives and examines the provision rule for public inputs within a two-class framework of optimal income taxation. If income redistribution policies must be designed under a self-selection constraint because the ability of any particular worker is private information, public input provision is used as a means of relaxing this constraint. This use of public inputs for helping income redistribution entails a deviation from the first-best provision rule. The resultant inefficiency is due to the impact of public input provision on the wage differential between workers with different abilities.

JEL-codes: H21 H23 H54 (search for similar items in EconPapers)
Date: 2001
References: Add references at CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
https://www.mohrsiebeck.com/en/article/public-inpu ... 16280015221022905722
Fulltext access is included for subscribers to the printed version.

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:mhr:finarc:urn:sici:0015-2218(200112)58:1_12:pipiao_2.0.tx_2-7

Ordering information: This journal article can be ordered from
Mohr Siebeck GmbH & Co. KG, P.O.Box 2040, 72010 Tübingen, Germany

Access Statistics for this article

FinanzArchiv: Public Finance Analysis is currently edited by Alfons Weichenrieder, Ronnie Schöb and Jean-François Tremblay

More articles in FinanzArchiv: Public Finance Analysis from Mohr Siebeck, Tübingen
Bibliographic data for series maintained by Thomas Wolpert ().