EconPapers    
Economics at your fingertips  
 

Higher Taxes at the Top: The Role of Entrepreneurs

Bettina Brueggemann
Authors registered in the RePEc Author Service: Bettina Brüggemann

Department of Economics Working Papers from McMaster University

Abstract: This paper computes optimal top marginal tax rates in Bewley- Aiyagari type economies that include entrepreneurs. Consistent with the data,entrepreneurs are over-represented at the top of the income distribution and are thus disproportionately affected by an increase in the top marginal income tax rate. The statutory top marginal tax rate that maximizes welfare is 75 percent and revenue is maximized at 85 percent. While average welfare gains are positive, they are larger for entrepreneurs than for workers and the occupational gap in welfare gains widens with increasing income.

Pages: 39 pages
Date: 2017-11-20
New Economics Papers: this item is included in nep-ent, nep-pbe 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)
http://socserv.mcmaster.ca/econ/rsrch/papers/archive/McMasterEconWP2017-16.pdf (application/pdf)

Related works:
Working Paper: Higher Taxes at the Top: The Role of Entrepreneurs (2016) Downloads
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:mcm:deptwp:2017-16

Access Statistics for this paper

More papers in Department of Economics Working Papers from McMaster University Contact information at EDIRC.
Bibliographic data for series maintained by ().

 
Page updated 2020-10-26
Handle: RePEc:mcm:deptwp:2017-16