Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/167559
Authors: 
Bierbrauer, Felix
Boyer, Pierre C.
Year of Publication: 
2017
Series/Report no.: 
CESifo Working Paper 6573
Abstract: 
We present a conceptual framework for the analysis of politically feasible tax reforms. First, we prove a median voter theorem for monotonic reforms of non-linear tax systems. This yields a characterization of reforms that are preferred by a majority of individuals over the status quo and hence politically feasible. Second, we show that every Pareto-efficient tax systems is such that moving towards lower tax rates for below-median incomes and towards higher rates for above median incomes is politically feasible. Third, we develop a method for diagnosing whether a given tax system admits reforms that are welfare-improving and/ or politically feasible.
Subjects: 
non-linear income taxation
tax reforms
political economy
welfare analysis
JEL: 
C72
D72
D82
H21
Document Type: 
Working Paper

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