On the Consequences of Eliminating Capital Tax Differentials

Ctirad Slavik and Hakki Yazici ()

VfS Annual Conference 2014 (Hamburg): Evidence-based Economic Policy from Verein für Socialpolitik / German Economic Association

Abstract: In the United States structure and equipment capital are e ffectively taxed at different rates. Recently, President Obama joined the group of policy makers and economists who propose to eliminate these di erentials. This paper analyzes the consequences of such a reform using an incomplete markets model with equipment-skill complementarity. We fi nd that the reform increases average welfare by 0.1%. Importantly, we fi nd that the reform does not involve the usual effi ciency vs. equality trade-o ff: it improves both.

JEL-codes: E62 H21 H25 (search for similar items in EconPapers)
Date: 2014
New Economics Papers: this item is included in nep-mac, nep-pbe and nep-pub
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8) Track citations by RSS feed

Downloads: (external link)
https://www.econstor.eu/bitstream/10419/100479/1/VfS_2014_pid_169.pdf (application/pdf)

Related works:
Journal Article: On the consequences of eliminating capital tax differentials (2019)
Journal Article: On the consequences of eliminating capital tax differentials (2019)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc14:100479

Access Statistics for this paper

More papers in VfS Annual Conference 2014 (Hamburg): Evidence-based Economic Policy from Verein für Socialpolitik / German Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by ZBW - Leibniz Information Centre for Economics ().