Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/78335
Authors: 
Homburg, Stefan
Year of Publication: 
2002
Series/Report no.: 
Diskussionspapiere der Wirtschaftswissenschaftlichen Fakultät, Universität Hannover 255
Abstract: 
Previous studies have shown that the optimal marginal tax rate at the bottom of the income distribution may be positive, negative, or even zero. This paper reexamines this problem in a unified framework and tries to evaluate the arguments. It turns out that the case for positive marginal tax rates is quite strong, whereas negative marginal tax rates seem to be based on a misconception.
Subjects: 
Optimal income taxation
contract theory
incentives
welfare
JEL: 
H2
D3
Document Type: 
Working Paper

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