| 1. |
- Aronsson, Thomas, 1963-, et al.
(författare)
-
A note on optimal taxation, status consumption, and unemployment
- 2021
-
Ingår i: Journal of Public Economics. - : Elsevier BV. - 0047-2727 .- 1879-2316. ; 200
-
Tidskriftsartikel (refereegranskat)abstract
- Existing research on optimal taxation in economies with status-driven relative consumption (implicitly) assumes that there is no involuntary unemployment, despite ample evidence that real world labor markets are typically characterized by such unemployment. We show how the marginal tax policy ought to be modified to simultaneously account for positional consumption externalities and equilibrium unemployment, and find that interaction effects between these two market failures are crucial determinants of the marginal tax structure. In certain cases, the policy incentive to tax away positional externalities vanishes completely, and negative positional externalities may even lead to lower marginal taxation, under involuntary unemployment. (c) 2021 Elsevier B.V. All rights reserved.
|
|
| 2. |
- Aronsson, Thomas, et al.
(författare)
-
Conspicuous Leisure : Optimal Income Taxation When Both Relative Consumption and Relative Leisure Matter
- 2013
-
Ingår i: Scandinavian Journal of Economics. - : Wiley. - 0347-0520 .- 1467-9442. ; 115:1, s. 155-175
-
Tidskriftsartikel (refereegranskat)abstract
- In previous studies on public policy under relative-consumption concerns, leisure comparisons have been ignored. In this paper, we consider a two-type optimal non-linear income tax model, in which people care about both their relative consumption and their relative leisure. Increased consumption positionality typically implies higher marginal income tax rates for both ability types, whereas leisure positionality has an offsetting role. However, this offsetting role is not symmetric; concern about relative leisure implies a progressive income tax component (i.e., a component that is larger for the high-ability type than for the low-ability type). Leisure positionality does not modify the policy rule for public-good provision.
|
|
| 3. |
- Aronsson, Thomas, 1963-, et al.
(författare)
-
Inequality Aversion, Externalities, and Pareto-Efficient Income Taxation
- 2020
-
Rapport (övrigt vetenskapligt/konstnärligt)abstract
- This paper analyzes Pareto-efficient marginal income taxation taking into account externalities induced through individual inequality aversion, meaning that people have preferences for equality. In doing so, we distinguish between four different and widely used models of inequality aversion. The results show that empirically and experimentally quantified degrees of inequality aversion have potentially very strong implications for Pareto-efficient marginal income taxation. It also turns out that the type of inequality aversion (self-centered vs. non-self-centered), and the specific measures of inequality used, matter a great deal. For example, based on simulation results mimicking the disposable income distribution in the U.S., the preferences suggested by Fehr and Schmidt (1999) imply monotonically increasing marginal income taxes, with large negative marginal tax rates for low-income individuals and large positive marginal tax rates for high-income ones. In contrast, the in many respects comparable model by Bolton and Ockenfels (2000) implies close to zero marginal income tax rates for all.
|
|
| 4. |
- Aronsson, Thomas, 1963-, et al.
(författare)
-
Optimal redistributive charity
- 2024
-
Ingår i: SCANDINAVIAN JOURNAL OF ECONOMICS. - : John Wiley & Sons. - 0347-0520 .- 1467-9442.
-
Tidskriftsartikel (refereegranskat)abstract
- This paper analyzes optimal redistributive charitable giving in a Mirrleesian framework. The status motive behind charity, the stigma from receiving donations, and transaction costs all work to decrease the optimal marginal subsidies on redistributive charity. Because the existing empirical evidence of these effects (when available) is highly uncertain and context-dependent, the range of possible outcomes is large, and even includes the possibility that charitable giving should be taxed rather than subsidized. In a natural benchmark case, the optimal tax treatment of charitable giving is consistent with a simple tax credit, whereas pure tax deductions are never part of the optimal policy.
|
|
| 5. |
- Aronsson, Thomas, 1963-, et al.
(författare)
-
Social Comparisons and Optimal Taxation in a Small Open Economy
- 2019
-
Ingår i: Scandinavian Journal of Economics. - : John Wiley & Sons. - 0347-0520 .- 1467-9442. ; 121:4, s. 1500-1532
-
Tidskriftsartikel (refereegranskat)abstract
- In this paper, we analyze how international capital mobility affects the optimal labor and capital income tax policy in a small open economy when consumers care about relative consumption. The main results crucially depend on whether the government can tax returns on savings abroad. If the government can use flexible residence-based capital income taxes, then the optimal policy rules from a closed economy largely carry over to the case of a small open economy. If it cannot, then capital income taxes become completely ineffective. The labor income taxes must then indirectly also reflect the corrective purpose that the absent capital income tax would have had.
|
|
| 6. |
- Aronsson, Thomas, 1963-, et al.
(författare)
-
State-variable public goods and social comparisons
- 2014
-
Ingår i: Journal of Environmental Economics and Management. - : Elsevier. - 0095-0696 .- 1096-0449. ; 68:2, s. 390-410
-
Tidskriftsartikel (refereegranskat)abstract
- The optimal provision of a state-variable public good, where the global climate is the prime example, is analyzed in a model where people care about their relative consumption. We consider both keeping-up-with-the-Joneses preferences (where people compare their own current consumption with others’ current consumption) and catching-up-with-the-Joneses preferences (where people compare their own current consumption with others’ past consumption) in an economy with two productivity types, overlapping generations, and optimal nonlinear income taxation. The extent to which the conventional rules for provision of state-variable public goods (a dynamic analog of the Samuelson rules) ought to be modified is shown to clearly depend on the strength of the relative concerns of both kinds, but also on the preference elicitation format.
|
|
| 7. |
- Aronsson, Thomas, 1963-, et al.
(författare)
-
Veblen's theory of the leisure class revisited: implications for optimal income taxation
- 2013
-
Ingår i: Social Choice and Welfare. - : Springer Science and Business Media LLC. - 0176-1714 .- 1432-217X. ; 41:3, s. 551-578
-
Tidskriftsartikel (refereegranskat)abstract
- Several previous studies have demonstrated the importance of relative consumption comparisons for public policy. Yet, almost all of them have ignored the role of leisure for status comparisons. Inspired by Veblen (The theory of the leisure class. Macmillan, New York, 1899), this paper assumes that people care about their relative consumption and that leisure has a displaying role in making relative consumption more visible, based on a two-type model of optimal income taxation. While increased importance of relative consumption typically implies higher marginal income tax rates, in line with previous research, the effect of leisure-induced consumption visibility is to make the income tax more regressive in terms of ability.
|
|
| 8. |
- Aronsson, Thomas, 1963-, et al.
(författare)
-
When Samuelson Met Veblen Abroad: National and Global Public Good Provision when Social Comparisons Matter
- 2014
-
Ingår i: Economica. - : Wiley. - 0013-0427 .- 1468-0335. ; 81:322, s. 224-243
-
Tidskriftsartikel (refereegranskat)abstract
- This paper derives Pareto-efficient provision rules for national and global public goods in a two-country world, where each individual cares about his or her relative consumption of private goods compared to other domestic and foreign residents. We contrast these rules with those following from a non-cooperative Nash equilibrium. Both national and global public goods are underprovided in Nash equilibrium under such relative consumption concerns. Finally, when individuals also care about the relative consumption of national public goods, based on between-country comparisons, the optimal provision rule depends on whether or not the national public goods are less positional than private consumption. EL AB, 2005, REV ECON STUD, V72, P1
|
|
| 9. |
- Carlsson, Fredrik, 1968, et al.
(författare)
-
Funding a New Bridge in Rural Vietnam: A field experiment on conditional cooperation and default contributions
- 2011
-
Rapport (övrigt vetenskapligt/konstnärligt)abstract
- The ability to provide public goods is essential for economic and social development, yet there is very limited empirical evidence regarding contributions to a real local public good in developing countries. This paper analyzes a field experiment where 200 households in rural Vietnam could make real contributions to an archetypical public good, a bridge. In particular, we study the role of two kinds of social influence: i) conditional cooperation, i.e., that people may be more willing to cooperate if others do, and ii) the effects of the default alternative, i.e., that people are influenced by the default alternative presented to them in the choice situation. We find significant and substantial effects of both kinds of influence. For example, by either giving the subjects the additional information that one of the most common contributions by others is 100,000 dong (a relatively low contribution) or introducing a zero-contribution default alternative, the average contribution decreases by about 20% compared to the baseline case.
|
|
| 10. |
- Aronsson, Thomas, 1963-, et al.
(författare)
-
Paternalism against Veblen: Optimal Taxation and Non-respected Preferences for Social Comparisons
- 2018
-
Ingår i: American Economic Journal-Economic Policy. - : American Economic Association. - 1945-7731 .- 1945-774X. ; 10:1, s. 39-76
-
Tidskriftsartikel (refereegranskat)abstract
- This paper compares optimal nonlinear income tax policies of welfarist and paternalist governments, where the latter does not respect individual preferences regarding relative consumption. Consistent with previous findings, relative consumption concerns typically induce a welfarist government to increase the marginal tax rates to internalize positional externalities. Remarkably, the optimal marginal tax rules are often very similar in the paternalist case, where such externalities are not taken into account. We identify several cases where the marginal tax rules are indeed identical between the governments. Numerical simulations show that marginal and average tax levels and the overall redistribution are often also similar.
|
|
