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When does a decrease in a distortion increase welfare?
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When does a decrease in a distortion increase welfare?

Author: Russell D Roberts Affiliation: Washington University, St. Louis MO, USA
Edition/Format: Article Article : English
Publication:Economics Letters, v39 n1 (1992): 37-42
Database:ScienceDirect
Summary:
With non-identical individuals, when does decreasing a distortion increase welfare? Minimizing the tax rate is efficient as long as pre-tax income is decreasing in the tax rate. This condition is likely to hold for typical methods of financing public goods.
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Document Type: Article
All Authors / Contributors: Russell D Roberts Affiliation: Washington University, St. Louis MO, USA
ISSN:0165-1765
Language Note: English
Unique Identifier: 4929946941
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Abstract:

With non-identical individuals, when does decreasing a distortion increase welfare? Minimizing the tax rate is efficient as long as pre-tax income is decreasing in the tax rate. This condition is likely to hold for typical methods of financing public goods.

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