Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/56167 
Year of Publication: 
2003
Series/Report no.: 
SSE/EFI Working Paper Series in Economics and Finance No. 522
Publisher: 
Stockholm School of Economics, The Economic Research Institute (EFI), Stockholm
Abstract: 
This paper examines the implications of income redistribution on human capital accumulation and income inequality, presenting a model where human capital investment is indivisible and agents differ in economic opportunity as well as intellectual ability. It is shown that the impact of redistribution is ambiguous on the income distribution as well as on human capital accumulation. In particular, while redistributive policy is likely to be successful both in terms of efficiency and equity in low-tax societies, it may be highly detrimental in both respects if the rate of redistribution is already moderate or high.
Subjects: 
human capital
talent
efficiency
equity
redistributive taxation
JEL: 
H31
J24
Document Type: 
Working Paper

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