Taxation for redistribution: Optimal tax structures along the utility possibility frontier

John Burbidge ()
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John Burbidge: School of Economics, University of Waterloo

No 26003, Working Papers from University of Waterloo, Department of Economics

Abstract: Mirrlees (1971) examined taxation for redistribution with imperfect information - the government can observe earnings but not wage rates or hours worked. Mirrlees assumed a one-good model with a continuum of types. Stiglitz (1982) worked out the two-type example of the Mirrlees model. This paper extends the distance-function approach to the Ramsey (1927) problem in Burbidge (2025a) to study optimal tax structures along the utility possibility frontier, upf, with two types and two goods.

Keywords: Taxation; redistribution; Mirrlees model (search for similar items in EconPapers)
Pages: 21 pages
Date: 2026-01-08
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