Tax Progressivity and Income InequalityJoel Slemrod This book assembles nine research papers on tax progressivity and its relationship to income inequality, written by leading public finance economists. The papers document the changes during the 1980s in progressivity at the federal, state, and local level in the U.S. Conceptual issues about how to measure progressivity are investigated. One paper investigates the extent to which the declining progressivity contributed to the well- documented increase in income inequality over the past two decades. Several papers investigate the economic impact and cost of progressive tax systems. Special attention is given to the behavioral response to taxation of high-income individuals, portfolio behavior, and the taxation of capital gains. The concluding sets of papers addresses the contentious issue of what constitutes a fair tax system. They contrast public attitudes concerning alternative tax systems to economistst notions of fairness and the tradeoff between fairness and economic growth. Each paper is followed by remarks of the conference discussant plus a summary of the conference discussion. |
Contents
Introduction | 1 |
Trends in federal tax progressivity 198093 | 9 |
the impact of | 95 |
The efficiency cost of increased progressivity | 137 |
On the highincome Laffer curve | 177 |
descriptive | 219 |
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Common terms and phrases
analysis assets behavior benefits bracket budget capital gains realizations capital gains tax capital income changes in tax Consumer Finances consumption deadweight loss debt decile decline deductibility dividends earned income economic effective tax rates efficiency cost elasticity equity estimates excess burden exemption federal tax Gini coefficient higher implicit tax income distribution income groups income inequality income percentile Income quintile income-tax investment labor supply Laffer curve lifetime income loss limits low-income lower marginal tax rates measure overall Parameter set payroll taxes percentage period portfolio Poterba progressive taxation property tax reduced regressive response rise in inequality risk aversion sales taxes share simulations Slemrod social security Suits index Survey of Consumer Table tax burden tax changes tax incidence tax law tax liability tax policy tax progressivity Tax Reform Act tax system tax-exempt bonds taxable taxation taxpayers tion top 1 percent trends Triest welfare