When is the Laffer Curve for Consumption Tax Hump-Shaped?

Kazuki Hiraga and Kengo Nutahara

No 16-002E, CIGS Working Paper Series from The Canon Institute for Global Studies

Abstract: This paper characterizes the shape of the Laffer curve for consumption tax. It is shown that the Laffer curve for consumption tax can be hump-shaped if the utility function is additively separable in consumption and labor supply. Conversely, it cannot be hump-shaped if the utility function is non-separable as reported by previous researchers. It is also shown that the difference in the utility functions has quantitatively significant effects on the peak tax rates of the Laffer curves for labor and capital income taxes.

Pages: 33
Date: 2016-02
New Economics Papers: this item is included in nep-pbe, nep-pub and nep-upt
References: Add references at CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
https://cigs.canon/article/uploads/pdf/workingpapers/160225_nutahara.pdf (application/pdf)

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:cnn:wpaper:16-002e

Access Statistics for this paper

More papers in CIGS Working Paper Series from The Canon Institute for Global Studies Contact information at EDIRC.
Bibliographic data for series maintained by The Canon Institute for Global Studies ().