A Pareto upper tail for capital income distribution

2018 ◽  
Vol 492 ◽  
pp. 403-417 ◽  
Author(s):  
Bogdan Oancea ◽  
Dan Pirjol ◽  
Tudorel Andrei
Keyword(s):  
Income Distribution ◽  
Capital Income

Inequality

2020 ◽  
pp. 565-604
Author(s):  
Christopher Tsoukis
Keyword(s):  
Income Distribution ◽  
Endogenous Growth ◽  
Growth Models ◽  
Inequality Measurement ◽  
Capital Income ◽  
Representative Agent ◽  
Macroeconomic Models ◽  
Measurement Issues ◽  
Labour Share ◽  
Endogenous Growth Models

By whatever indicator it is assessed, inequality has been rising in recent years. This book considers it a macroeconomic issue and innovates by including it among its topics. The chapter begins by reviewing evidence and facts on inequality, measurement issues, and the relation with poverty. The macroeconomic models of income distribution reviewed next include vintage models, endogenous growth models, and whether inequality can be accommodated in ‘representative-agent’ models. Attention then turns to ‘factor’ (labour-capital) income shares, which have also been changing recently, reviewing both the relevant analytics and the possible processes that underlie this change. The chapter concludes with recent debates on determinants of inequality, the evolution of the labour share (the ‘r-g’ question), and the future of income distribution.

scholarly journals An allegory of the political influence of the top 1%

2016 ◽  
Vol 18 (1) ◽  
pp. 85-96 ◽  
Author(s):  
Philippe De Donder ◽  
John E. Roemer
Keyword(s):  
Income Distribution ◽  
Political Influence ◽  
Comparative Statics ◽  
Majority Voting ◽  
Capital Income ◽  
Tax Rate ◽  
High Productivity ◽  
Lump Sum ◽  
Lobbying Effort ◽  
Average Utility

We study how rich shareholders use their political influence to deregulate firms that they own, thus skewing the income distribution towards themselves. Individuals differ in productivity and choose how much labor to supply. High productivity individuals also own shares in the productive sector and thus earn capital income. All individuals vote over a linear tax rate on (labor and capital) income whose proceeds are redistributed lump sum. Shareholders also lobby in order to ease the price cap imposed on the private firm. We first solve analytically for the Kantian equilibrium of this lobbying game together with the majority voting equilibrium over the tax rate. We then proceed to a comparative statics analysis of the model with the help of numerical simulations. We obtain that, as the capital income distribution becomes more concentrated among the top productivity individuals, increased lobbying effort generates efficiency as well as equity costs, with lower labor supply and lower average utility levels in society.

scholarly journals Bracket Creep Revisited – with and without r > g: Evidence from Germany

2016 ◽  
pp. 106
Author(s):  
Junyi Zhu
Keyword(s):  
Income Distribution ◽  
Income Tax ◽  
Social Insurance ◽  
Inflation Rate ◽  
Household Finance ◽  
Capital Income ◽  
Social Insurance Contribution ◽  
Micro Simulation ◽  
Redistributive Effect ◽  
Insurance Contribution

Using German income distribution in 2009, this article studies the redistributive and revenue effects of bracket creep under various inflation scenarios. We develop a tax micro-simulation model for the newly available Panel on Household Finance (PHF) data. The simulation yields an inverted U-shaped overall redistributive effect of the income tax and social insurance contribution system with respect to the inflation rate, which contrasts with Immervoll (2005), who finds that fiscal drag always enhances the equalising effect. The nominal income growth as well as the deterioration of tax progression at the middle and top of the income distribution between 1998 and 2009 can be the impetus for this change. This result implies that delaying adjustment might reduce redistribution. We also suggest that these results might not be restricted solely to Germany. Additionally, when we introduce the empirical evidence that capital income grows faster than non-capital income r > g, the dual tax system with a flat capital income tax implemented in 2009 further disequalises the after-tax income substantially. Allowing inflation compensation to lean towards the poor by boosting their share of capital income may not be favourable to redistribution.

scholarly journals SALARIOS Y PRECIOS DE LOS FACTORES EN BUENOS AIRES, 1770-1880: UNA APROXIMACIÓN A LA DISTRIBUCIÓN FUNCIONAL DEL INGRESO EN EL LARGO PLAZO

2015 ◽  
Vol 33 (1) ◽  
pp. 153-186 ◽  
Author(s):  
Jorge Gelman ◽  
Daniel Santilli
Keyword(s):  
Income Distribution ◽  
Buenos Aires ◽  
Colonial Period ◽  
Primary Sources ◽  
Belle Epoque ◽  
Capital Income ◽  
Land Prices ◽  
Cattle Farming ◽  
Belle Époque

ABSTRACTThis article studies inequality in Buenos Aires from the late colonial period to the beginning of thebelle époquethrough series of prices based on primary sources. This enables a comparison of the evolution of land prices and wages in order to estimate the functional income distribution among workers and proprietors. The evolution of livestock prices is assessed as well to capture a more complete image of capital income, due to the importance of cattle raising for the economy of Buenos Aires. The outcome reveals an increasing inequality since the dawn of the cattle-farming boom at the beginning of the independent era.

scholarly journals Factor Substitution, Income Distribution and Growth in a Generalized Neoclassical Model

2009 ◽  
Vol 10 (4) ◽  
pp. 464-479 ◽  
Author(s):  
Andreas Irmen ◽  
Rainer Klump
Keyword(s):  
Income Distribution ◽  
Threshold Value ◽  
Capital Income ◽  
Neoclassical Growth Model ◽  
Distribution Effect ◽  
Savings Rate ◽  
Factor Substitution ◽  
Recent Debate ◽  
The Impact ◽  
Neoclassical Growth

Abstract We analyze a generalized neoclassical growth model that combines a normalized CES production function and possible asymmetries of savings out of factor incomes. This generalized model helps to shed new light on a recent debate concerning the impact of factor substitution and income distribution on economic growth. We show that this impact relies on both an efficiency and a distribution effect, where the latter is caused by the distributional consequences of an increase in the elasticity of substitution. While the efficiency effect is always positive, the sign of the distribution effect depends on the particular savings hypothesis. If the savings rate out of capital income is substantial so that a certain threshold value is surpassed, the efficiency effect dominates and higher factor substitution accelerates the accumulation of capital and works as a major engine of growth.

The State’s Role in Ensuring Fair Income Distribution in Vietnam Today: Some Issues from the Theory of Justice as Fairness by John Rawls

2020 ◽  
Vol 6 (2) ◽  
pp. 181-195
Keyword(s):  
Income Distribution ◽  
Economic Efficiency ◽  
John Rawls ◽  
Social Stability ◽  
Social Equality ◽  
Justice As Fairness ◽  
Theory Of Justice ◽  
Analysis And Synthesis ◽  
Economic Philosophy ◽  
The Relationship

Fairness in income distribution is a factor that both motivates employees and contributes to maintaining social stability. In Vietnam, fair income distribution has been studied from various perspectives. In this article, through the analysis and synthesis of related documents and evidence, and from the perspective of economic philosophy, the author applies John Rawls’s Theory of Justice as Fairness to analyze some issues arising from the implementation of the state’s role in ensuring fair income distribution from 1986 to present. These are unifying the perception of fairness in income distribution; solving the relationship between economic efficiency and social equality; ensuring benefits for the least-privileged people in society; and controlling income. On that basis, the author makes some recommendations to enhance the state’s role in ensuring fair income distribution in Vietnam. Received 11thNovember 2019; Revised 10thApril 2020; Accepted 20th April 2020

Inequality and the Safety Net Throughout the Income Distribution, 1929-1940

2020 ◽  
Author(s):  
James Feigenbaum ◽  
Price Fishback ◽  
Keoka Grayson
Keyword(s):  
Income Distribution ◽  
Safety Net

Hungarian small business tax and possibilities to minimize distortions from capital income taxation

2015 ◽  
Vol 37 (s1) ◽  
pp. 87-105
Author(s):  
Benedek Nobilis ◽  
András Svraka
Keyword(s):  
Small Business ◽  
Cash Flow ◽  
Capital Accumulation ◽  
Value Added ◽  
Regulatory Elements ◽  
Capital Income ◽  
Potential Growth ◽  
Elegant Method ◽  
Business Tax ◽  
Working Out

Governments throughout the EU and OECD countries rely on revenues raised on capital income. Albeit several arguments can be made for keeping these taxes, in their widespread form they hinder capital accumulation and significantly lower potential growth due to their savings and investment distorting nature. At the same time, the actual economic impact of tax types is largely influenced by their structure. An elegant method, which is also simple in its concept, for eliminating the economic distortions of profit taxes is cash-flow taxation which moves income taxes closer to the more growth-friendly value-added taxes. The small business tax, which was introduced in Hungary in 2013, was designed along these principles. In this paper we review the theoretical literature on cash-flow taxation and discuss the main regulatory elements of the small business tax, as well as the solutions elaborated for working out the challenges related to its implementation.

Sign in / Sign up

Export Citation Format

Share Document