The Economics of Taxing the Rich

Joel Slemrod

No 6584, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: How much and how to tax high-income individuals is at the core of many recent proposals for incremental as well as fundamental tax reform. This paper critically reviews the economics literature and concludes that the right answer to these questions depends in part on value judgments about which economics has little to contribute, but also depends on standard economics concerns such as the process generating income and wealth, and whether wealth individuals' economic activities have positive (or negative) externalities. How much and how to tax the rich also depends critically on how they will respond to attempts to tax them because, other things equal, it is wise to limit the extent to which they are induced to pursue less socially productive activities in order to avoid taxes.

JEL-codes: H20 (search for similar items in EconPapers)
Date: 1998-05
Note: PE
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Citations: View citations in EconPapers (5)

Published as Slemrod, J. (ed.) Does Atlas Shrug? The Economic Consequences of Taxing the Rich. Cambridge: Harvard University Press, 2002.

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