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Title:Education, Redistributive Taxation and Confidence PDF Logo
Authors:Konrad, Kai A.
Spadaro, Amedeo
Issue Date:2005
Series/Report no.:IZA Discussion paper series 1478
Abstract:We consider redistributional taxation between people with and without human capital if education is endogenous and if individuals differ in their perceptions about own ability. Those who see their ability as low like redistributive taxation because of the transfers it generates. Those who see their ability as high may also like redistributive taxation because it stops other people receiving education and increases the quasi rents on their own human capital. It is surprising that this rather indirect effect can overcompensate them for the income loss from taxation and make the overconfident want higher taxes than the less confident do. The results, however, turn out to be in line with empirical evidence on the desired amount of redistribution among young individuals.
Subjects:education
redistribution
confidence
JEL:I21
H23
D78
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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