Abstract
A theory of optimal taxation is presented, building upon Becker's (1965) theory of the allocation of time. Optimal commodity taxation is governed by factor shares in household activities. Any market good which requires little household time, or even saves time, should carry a relatively low tax rate. This policy rule does not require the estimation of price elasticities and is therefore more applicable than traditional Ramsey rule taxation.
Original language | English (US) |
---|---|
Pages (from-to) | 545-557 |
Number of pages | 13 |
Journal | Journal of Public Economics |
Volume | 88 |
Issue number | 3-4 |
DOIs | |
State | Published - Mar 2004 |
Externally published | Yes |
All Science Journal Classification (ASJC) codes
- Finance
- Economics and Econometrics
Keywords
- Commodity taxation
- Household production
- Time allocation