Capital Taxation: Quantitative Explorations of the Inverse Euler Equation

Journal of Political Economy

Volumn 120, Issue 3, 2012, Pages 398-445

  Farhi, Emmanuel ^a   Werning, Iván ^b  

^a HARVARD UNIVERSITY   (United States)

^b MASSACHUSETTS INSTITUTE OF TECHNOLOGY   (United States)

Author keywords

[No Author keywords available]

Indexed keywords

BENCHMARKING; CALIBRATION; CAPITAL; EULERIAN ANALYSIS; GENERAL EQUILIBRIUM ANALYSIS; QUANTITATIVE ANALYSIS; TAX SYSTEM; UNCERTAINTY ANALYSIS;

EID: 84863815945     PISSN: 00223808     EISSN: None     Source Type: Journal    
DOI: 10.1086/666747     Document Type: Article

References (45)

1. Abowd, John M., and David Card. 1987. "Intertemporal Labor Supply and Long-Term Employment Contracts. " A.E.R. 77 (1): 50-68.
2. Abowd, John M., and David Card. 1989. "On the Covariance Structure of Earnings and Hours Changes. " Econometrica 57 (2): 411-45.
3. Aguiar, Mark, and Erik Hurst. 2005. "Consumption versus Expenditure. " J.P.E. 113 (5): 919-48.
4. Aiyagari, S. Rao. 1994. "Uninsured Idiosyncratic Risk and Aggregate Saving. " Q.J.E. 109 (3): 659-84.
5. Atkeson, Andrew, and Robert E. Lucas Jr. 1992. "On Efficient Distribution with Private Information. " Rev. Econ. Studies 59 (3): 427-53.
6. Atkinson, A. B., and J. E. Stiglitz. 1976. "The Design of Tax Structure: Direct versus Indirect Taxation. " J. Public Econ. 6 (1-2): 55-75.
7. Blundell, Richard, Luigi Pistaferri, and Ian Preston. 2008. "Consumption Inequality and Partial Insurance. " A.E.R. 98 (5): 1887-1921.
8. Chamley, Christophe. 1986. "Optimal Taxation of Capital in General Equilibrium. " Econometrica 54:607-22.
9. Conesa, Juan Carlos, and Dirk Krueger. 2005. "On the Optimal Progressivity of the Income Tax Code. " J. Monetary Econ. 53 (7): 1425-50.
10. Davila, Julio, Jay H. Hong, Per Krusell, and Jose-Victor Rios-Rull. 2005. "Constrained Efficiency in the Neoclassical Growth Model with Uninsurable Idiosyncratic Shocks. " Working Paper no. 05-023, Penn Inst. Econ. Res., Dept. Econ., Univ. Pennsylvania. http://ideas.repec.org/p/pen/papers/05-023.html.
11. Deaton, Angus, and Christina Paxson. 1994. "Intertemporal Choice and Inequality. " J.P.E. 102 (3): 437-67.
12. Diamond, Peter A., and James A. Mirrlees. 1997. "A Model of Social Insurance with Variable Retirement. " Working Paper no. 210, Dept. Econ., Massachusetts Inst. Tech.
13. Farhi, Emmanuel, and Iván Werning. 2007. "Inequality and Social Discounting. " J.P.E. 115 (3): 365-402.
14. Farhi, Emmanuel, and Iván Werning. 2008. "Optimal Savings Distortions with Recursive Preferences. " J. Monetary Econ. 55:21-42.
15. Farhi, Emmanuel, and Iván Werning. 2010. "Insurance and Taxation over the Life Cycle. " Working Paper no. 16749, NBER, Cambridge, MA.
16. Friedman, Milton. 1962. Capitalism and Freedom. Chicago: Univ. Chicago Press.
17. Geanakoplos, John, and Heracles M. Polemarchakis. 1985. "Existence, Regularity, and Constrained Suboptimality of Competitive Allocations When the Asset Market Is Incomplete. " Cowles Found. Discussion Papers no. 764, Yale Univ. http://ideas.repec.org/p/cwl/cwldpp/764.html.
18. Golosov, Mikhail, Narayana Kocherlakota, and Aleh Tsyvinski. 2003. "Optimal Indirect and Capital Taxation. " Rev. Econ. Studies 70 (3): 569-87.
19. Golosov, Mikhail, Maxim Troshkin, and Aleh Tsyvinski. 2010. "Optimal Dynamic Taxes. " Working paper, Dept. Econ., Yale Univ.
20. Golosov, Mikhail, and Aleh Tsyvinski. 2006. "Designing Optimal Disability Insurance: A Case for Asset Testing. " J.P.E. 114 (2): 257-79.
21. Golosov, Mikhail, Aleh Tsyvinski, and Iván Werning. 2006. "New Dynamic Public Finance: A User's Guide. " NBER Macroeconomics Ann. 21:317-87.
22. Guvenen, Fatih. 2007. "Learning Your Earning: Are Labor Income Shocks Really Very Persistent?" A.E.R. 97 (3): 687-712.
23. Guvenen, Fatih. 2009. "An Empirical Investigation of Labor Income Processes. " Rev. Econ. Dynamics 12 (1): 58-79.
24. Hause, John C. 1980. "The Fine Structure of Earnings and the On-the-Job Training Hypothesis. " Econometrica 48:1013-29.
25. Heathcote, Jonathan, Kjetil Storesletten, and Giovanni L. Violante. 2004. "Two Views of Inequality over the Life-Cycle. " J. European Econ. Assoc. 3:543-52.
26. Heaton, John, and Deborah J. Lucas. 1996. "Evaluating the Effects of Incomplete Markets on Risk Sharing and Asset Pricing. " J.P.E. 104 (3): 443-87.
27. Hopenhayn, Hugo A., and Juan Pablo Nicolini. 1997. "Optimal Unemployment Insurance. " J.P.E. 105 (2): 412-38.
28. Huggett, Mark. 1993. "The Risk-Free Rate in Heterogeneous-Agent Incomplete-Insurance Economies. " J. Econ. Dynamics and Control 17 (5-6): 953-69.
29. Judd, Kenneth L. 1985. "Redistributive Taxation in a Perfect Foresight Model. " J. Public Econ. 28:59-83.
30. Krueger, Dirk, and Fabrizio Perri. 2003. "On the Welfare Consequences of the Increase in Inequality in the United States. " NBER Macroeconomics Ann. 18: 83-121.
31. Kydland, Finn E. 1984. "A Clarification: Using the Growth Model to Account for Fluctuations: Reply. " Carnegie-Rochester Conf. Ser. Public Policy 21:225-52.
32. Ligon, Ethan. 1998. "Risk Sharing and Information in Village Economics. " Rev. Econ. Studies 65 (4): 847-64.
33. Lillard, Lee A., and Yoram A. Weiss. 1979. "Components of Variation in Panel Earnings Data: American Scientists, 1960-70. " Econometrica 47:437-54.
34. Lucas, Robert E., Jr. 1990. "Supply-Side Economics: An Analytical Review. " Oxford Econ. Papers 42 (2): 293-316.
35. Luenberger, David G. 1969. Optimization by Vector Space Methods. New York: Wiley.
36. Milgrom, Paul, and Ilya Segal. 2002. "Envelope Theorems for Arbitrary Choice Sets. " Econometrica 70 (2): 583-601.
37. Mirrlees, James A. 1971. "An Exploration in the Theory of Optimum Income Taxation. " Rev. Econ. Studies 38 (2): 175-208.
38. Rogerson, William P. 1985. "Repeated Moral Hazard. " Econometrica 53 (1): 69-76.
39. Sheshinski, Eytan. 1972. "The Optimal Linear Income-Tax. " Rev. Econ. Studies 39 (3): 297-302.
40. Shimer, Robert, and Ivan Werning. 2008. "Liquidity and Insurance for the Unemployed. " A.E.R. 98 (5): 1922-42.
41. Slesnick, Daniel T., and Aydogan Ulker. 2004. "Inequality and the Life-Cycle: Consumption. " Technical report, Univ. Texas Austin.
42. Spear, Stephen E., and Sanjay Srivastava. 1987. "On Repeated Moral Hazard with Discounting. " Rev. Econ. Studies 54 (4): 599-617.
43. Stokey, Nancy L., and Sergio Rebelo. 1995. "Growth Effects of Flat-Rate Taxes. " J.P.E. 103 (3): 519-50.
44. Storesletten, Kjetil, Christopher I. Telmer, and Amir Yaron. 2004a. "Consumption and Risk Sharing over the Life Cycle. " J. Monetary Econ. 51 (3): 609-33.
45. Storesletten, Kjetil, Christopher I. Telmer, and Amir Yaron. 2004b. "Cyclical Dynamics in Idiosyncratic Labor Market Risk. " J.P.E. 112 (3): 695-717.