Rehme, Günther (2023)
Capital depreciation allowances, redistributive taxation, and economic growth.
In: Journal of Public Economic Theory, 2020, 25 (1)
doi: 10.26083/tuprints-00023719
Artikel, Zweitveröffentlichung, Verlagsversion
Kurzbeschreibung (Abstract)
Are capital depreciation allowances when coupled with capital income taxes good instruments for redistribution in the long run? In a simple two‐agent‐economy I find that accelerated depreciation is good for growth, but bad for redistribution. The opposite holds for capital income taxes. However, in a feedback Stackelberg equilibrium, where the government is the leader and the private sector the follower, the depreciation allowance is maximal in the long run, time‐consistent optimum. This removes the accumulation distortion of capital income taxes. Furthermore, the latter, and so redistribution, is found to be generically nonzero in the time‐consistent optimum, and depends on the social weight of transfers receivers, the pretax factor income distribution, the intertemporal elasticity of substitution and the time preference rate. Thus, accelerated depreciation allowances are an important indirect tool for redistribution. The tax scheme allows for a separation of "efficiency" and "equity" concerns for redistributive policies.
| Typ des Eintrags: | Artikel |
|---|---|
| Erschienen: | 2023 |
| Autor(en): | Rehme, Günther |
| Art des Eintrags: | Zweitveröffentlichung |
| Titel: | Capital depreciation allowances, redistributive taxation, and economic growth |
| Sprache: | Englisch |
| Publikationsjahr: | 2023 |
| Ort: | Darmstadt |
| Publikationsdatum der Erstveröffentlichung: | 2020 |
| Verlag: | Wiley |
| Titel der Zeitschrift, Zeitung oder Schriftenreihe: | Journal of Public Economic Theory |
| Jahrgang/Volume einer Zeitschrift: | 25 |
| (Heft-)Nummer: | 1 |
| DOI: | 10.26083/tuprints-00023719 |
| URL / URN: | https://tuprints.ulb.tu-darmstadt.de/23719 |
| Zugehörige Links: | |
| Herkunft: | Zweitveröffentlichung DeepGreen |
| Kurzbeschreibung (Abstract): | Are capital depreciation allowances when coupled with capital income taxes good instruments for redistribution in the long run? In a simple two‐agent‐economy I find that accelerated depreciation is good for growth, but bad for redistribution. The opposite holds for capital income taxes. However, in a feedback Stackelberg equilibrium, where the government is the leader and the private sector the follower, the depreciation allowance is maximal in the long run, time‐consistent optimum. This removes the accumulation distortion of capital income taxes. Furthermore, the latter, and so redistribution, is found to be generically nonzero in the time‐consistent optimum, and depends on the social weight of transfers receivers, the pretax factor income distribution, the intertemporal elasticity of substitution and the time preference rate. Thus, accelerated depreciation allowances are an important indirect tool for redistribution. The tax scheme allows for a separation of "efficiency" and "equity" concerns for redistributive policies. |
| Status: | Verlagsversion |
| URN: | urn:nbn:de:tuda-tuprints-237198 |
| Sachgruppe der Dewey Dezimalklassifikatin (DDC): | 300 Sozialwissenschaften > 330 Wirtschaft |
| Fachbereich(e)/-gebiet(e): | 01 Fachbereich Rechts- und Wirtschaftswissenschaften 01 Fachbereich Rechts- und Wirtschaftswissenschaften > Volkswirtschaftliche Fachgebiete 01 Fachbereich Rechts- und Wirtschaftswissenschaften > Volkswirtschaftliche Fachgebiete > Fachgebiet Empirische Wirtschaftsforschung |
| Hinterlegungsdatum: | 28 Apr 2023 13:18 |
| Letzte Änderung: | 02 Mai 2023 09:30 |
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