Costs of Taxation and the Benefits of Public Goods : The Role of Income Effects

Costs of Taxation and the Benefits of Public Goods : The Role of Income Effects

The fact that raising taxes can increase taxed labor supply through income effects is frequently used to justify much lower measures of the marginal welfare cost of taxes and greater public good provision than indicated by traditional, compensated analyses. The authors confirm that this difference remains substantial with newer elasticity estimates, but show that either compensated or uncompensated measures of the marginal cost of funds can be used to evaluate the costs of taxation-and will provide the same result-as long as the income effects of both taxes and public good provision are incorporated in a consistent manner.

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Bibliographic Details
Main Authors: Martin, Will, Anderson, James E.
Format: Policy Research Working Paper biblioteca
Language:English
Published: World Bank, Washington, DC 2005-09
Subjects:AGGREGATE SUPPLY, BENCHMARK, BUDGET CONSTRAINTS, COMPETITIVE MARKET, CONSUMER DEMAND, CONSUMERS, DEVELOPING COUNTRIES, DISTORTIONARY TAXES, ECONOMIC RESEARCH, ECONOMIC REVIEW, ECONOMIC STUDIES, ECONOMISTS, ELASTICITIES, ELASTICITY, ELASTICITY OF SUPPLY, EMPIRICAL EVIDENCE, EQUATIONS, EXPENDITURES, FISCAL BALANCE, FISCAL COST, FISCAL COSTS, FISCAL POLICY, FOREIGN EXCHANGE, GDP, GOVERNMENT SPENDING, GROSS DOMESTIC PRODUCT, HOUSEHOLD INCOME, INCOME, INCOME EFFECT, INCOME EFFECTS, INCOME ELASTICITY, INCOME GENERATION, INCOME GROUPS, INCOME TAXATION, INCOME TAXES, INEFFICIENCY, INTERMEDIATE GOODS, INTERMEDIATE INPUTS, INTERNATIONAL TRADE, LEISURE, LOW INCOME, MARGINAL BENEFITS, MARGINAL COST, MARGINAL COSTS, MARGINAL VALUE, MARGINAL WELFARE COSTS, MARKET PRICES, NET IMPACT, NUMERAIRE, OUTPUT, OUTPUTS, POLICY ANALYSIS, POLICY DECISIONS, POLICY IMPLICATIONS, POLICY MAKERS, POLICY REFORM, POLICY RESEARCH, POLITICAL ECONOMY, PRICE CHANGES, PRIVATE GOODS, PRIVATE SECTOR, PRODUCERS, PRODUCTIVITY, PUBLIC ECONOMICS, PUBLIC FUNDS, PUBLIC GOOD, PUBLIC GOODS, PUBLIC SPENDING, QUOTAS, REAL INCOME, ROADS, SENSITIVITY ANALYSIS, SOCIAL COSTS, SOCIAL MARGINAL COST, TAX, TAX INCENTIVES, TAX RATES, TAX REFORM, TAX REFORMS, TAX REVENUE, TAX REVENUES, TAXABLE INCOME, TAXATION, USER CHARGES, VALUATION, WAGES, WELFARE EFFECTS, WILLINGNESS TO PAY,
Online Access:http://documents.worldbank.org/curated/en/2005/09/6259320/costs-taxation-benefits-public-goods-role-income-effects
http://hdl.handle.net/10986/8592
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http://documents.worldbank.org/curated/en/2005/09/6259320/costs-taxation-benefits-public-goods-role-income-effects
http://hdl.handle.net/10986/8592

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