RT Generic
T1 The welfare cost of taxation and endogenous growth
A1 Chamley, Christophe
A2 Universidad Carlos III de Madrid. Departamento de Economía, 
AB The marginal efficiency costs of different taxes is analyzed in three models with endogenous growth, and the values are compared with those found in standard models. The models analyze how taxes affect (i) the trade-off between human capital accumulation and leisure, (ii) the intertemporal trade-off in consumption, and (iii) the trade-offs in a two-sector model. In general, the efficiency cost in models with endogenous growth may be greater or lower than in models with exogenous growth. When the value of the efficiencycost is very large, it is found to be very sensitive to the specification of the model, and it is reduced dramatically when government expenditures are a production input. In the two-sector model, the only tax which has a very high efficiency cost is the tax on time spent for human capital accumulation, and it may not be empirically important. It is verified that a positive impact of a tax reform on the long-term growth rate is not indicative of welfare improvement.
SN 2340-5031
YR 1992
FD 1992-12
LK https://hdl.handle.net/10016/2890
UL https://hdl.handle.net/10016/2890
LA eng
DS e-Archivo
RD 2 may. 2024