A general equilibrium assessment of a suggested reform in capital income taxation

1995 ◽  
Vol 17 (6) ◽  
pp. 531-556 ◽  
Author(s):  
Erling Holmøy ◽  
Haakon Vennemo
Keyword(s):  
General Equilibrium ◽  
Income Taxation ◽  
Capital Income ◽  
Capital Income Taxation

Union Wage Setting and Capital Income Taxation in Dynamic General Equilibrium

2001 ◽  
Vol 2 (2) ◽  
pp. 141-175 ◽  
Author(s):  
Thomas Aronsson ◽  
Karl-Gustaf Löfgren ◽  
Tomas Sjögren
Keyword(s):  
General Equilibrium ◽  
Union Wage ◽  
Cost Benefit ◽  
Dynamic General Equilibrium ◽  
Income Taxation ◽  
Capital Income ◽  
Real Wages ◽  
Wage Setting ◽  
Capital Income Taxation ◽  
Small Shift

Abstract This paper concerns the effects of capital income taxation in a dynamic general equilibrium framework with union wage setting, when households face taxes related to both labor and capital. One purpose is to characterize the general equilibrium solution. Another is to study the effects of increased capital income taxation - in terms of the responses in real wages, employment, capital stock, output and consumption - and relate these behavioral responses to the overall tax structure. We also derive a cost-benefit rule for the purpose of analyzing the welfare effects of a small shift from labor income taxation to capital income taxation.

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