Optimum taxation of bequests in a model with initial wealth
Johann Brunner () and
Susanne Pech ()
No 2010-01, Economics working papers from Department of Economics, Johannes Kepler University Linz, Austria
We formulate an optimum-taxation model, where parents leave bequests to their descendants for altruistic reasons. In contrast to the standard model, individuals differ not only in earning abilities, but also in initial (inherited) wealth. In this model a redistributive motive for an inheritance tax - which is equivalent to a uniform tax on all expenditures - arises, given that initial wealth increases with earning abilities. Its introduction increases intertemporal social welfare or has an ambiguous effect, depending on whether the bequeathing generation can adjust their behaviour and whether the external effect related to altruism is accounted for in the social objective.
Keywords: Optimum taxation; taxation of bequests (search for similar items in EconPapers)
JEL-codes: H21 H24 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-acc and nep-pub
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed
Downloads: (external link)
Journal Article: Optimal Taxation of Bequests in a Model with Initial Wealth (2012)
Working Paper: Optimum taxation of bequests in a model with initial wealth (2010)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:jku:econwp:2010_01
Access Statistics for this paper
More papers in Economics working papers from Department of Economics, Johannes Kepler University Linz, Austria Contact information at EDIRC.
Bibliographic data for series maintained by René Böheim ().