Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/91370
Authors: 
Cavalcanti, Marco Antônio Freitas de Hollande
da Silva, Napoleão Luiz Costa
Year of Publication: 
2011
Series/Report no.: 
Texto para Discussão, Instituto de Pesquisa Econômica Aplicada (IPEA) 1594
Abstract (Translated): 
This paper aims to contribute to the debate on the best way to reduce the tax burden on the production sector in Brazil, by simulating an overlapping generations model calibrated to the country's economy. Our focus is on the comparison of the macroeconomic and welfare impacts brought about by policies that reduce the tax burden on labour and policies based on the reduction of the tax burden on capital. According to our results, reducing the tax burden on capital may lead to substantial gains in terms of capital accumulation and GDP relative to reducing the burden on labour. Both types of policies must generate welfare losses to elderly generations alive when the reform takes place and welfare gains to future generations, but the effects on intermediate generations may differ substantially under each policy.
JEL: 
E60
H20
Document Type: 
Working Paper

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