Optimal Tax-Transfer-Schemes under Partial Information

Stefan Homburg and Tim Lohse

Hannover Economic Papers (HEP) from Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät

Abstract: According to a widely held belief, all who are able to work, should work . We consider this statement within a framework of non-linear taxation. The crucial differ-ence between our model and the standard model is that the government can distinguish between productive persons and the disabled. A general proposition regarding the design of tax-transfer-schemes under such partial information is derived. Moreover, it is shown that unemployment on the side of the productive poor may still be optimal.

Keywords: Optimal Taxation; Employment; Poverty; Welfare (search for similar items in EconPapers)
JEL-codes: H21 I38 (search for similar items in EconPapers)
Pages: 9 pages
Date: 2004-05
New Economics Papers: this item is included in nep-pbe
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Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Optimal Taxes and Transfers under Partial Information (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:han:dpaper:dp-298

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