TAXING CAPITAL INCOME AS PIGOUVIAN CORRECTION: THE ROLE OF DISCOUNTING THE FUTURE

2005 ◽  
Vol 9 (4) ◽  
pp. 469-477 ◽  
Author(s):  
VALERIA DE BONIS ◽  
LUCA SPATARO
Keyword(s):  
Steady State ◽  
Utility Function ◽  
Discount Rate ◽  
Income Tax ◽  
Capital Income ◽  
Long Run ◽  
The Government ◽  
The Individual ◽  
Individual Choices

In this work, we find that the zero capital income tax result might not hold, even at the steady state, when the government discount rate differs from the individual one. As intuitive Pigouvian considerations would suggest, capital income should be taxed (subsidized) when the government is less (more) impatient than individuals are. However, a counterintuitive asymmetry emerges as for the steady state since, in the long run, capital income cannot be taxed because of the explosive distortionary effect of positive taxes. The asymmetry is ruled out with a logarithmic utility function because, in this case, the anticipated policy path does not affect current individual choices and thus the cumulative distortionary effect of taxes disappears.

Optimal capital-income taxation in a model with credit frictions

2014 ◽  
Vol 0 (0) ◽  
Author(s):  
Salem Abo-Zaid
Keyword(s):  
Income Tax ◽  
Income Taxation ◽  
Capital Income ◽  
Capital Income Taxation ◽  
Tax Rate ◽  
Long Run ◽  
Redistributive Taxation ◽  
Optimal Capital ◽  
Credit Frictions ◽  
The Government

AbstractThe optimality of the long-run capital-income tax rate is revisited in a simple neoclassical growth model with credit frictions. Firms pay their factors of production in advance, which requires borrowing at the beginning of the period. Borrowing, in turn, is constrained by the value of collateral that they own at the beginning of the period, leading to inefficiently low amounts of capital and labor. In this environment, the optimal capital-income tax in the steady state is non zero. Specifically, the quantitative analyses show that the capital-income tax is negative and, therefore, the distortions stemming from the credit friction are offset by subsidizing capital. However, when the government cannot distinguish between capital-income and profits, the capital-income tax is positive as the government levies the same tax rate on both sources of income. These results stand in contrast to the celebrated result of zero capital-income taxation of Judd (Judd, K. 1985. “Redistributive Taxation in a Simple Perfect Foresight Model.”

scholarly journals Between communism and capitalism: long-term inequality in Poland, 1892–2015

2021 ◽  
Author(s):  
Paweł Bukowski ◽  
Filip Novokmet
Keyword(s):  
Household Survey ◽  
National Accounts ◽  
Capital Income ◽  
Sharp Rise ◽  
Long Run ◽  
History Of ◽  
Low Levels ◽  
Distribution Of Income

AbstractWe construct the first consistent series on the long-term distribution of income in Poland by combining tax, household survey and national accounts data. We document a U-shaped evolution of inequalities from the end of the nineteenth century until today: (1) inequality was high before WWII; (2) abruptly fell after the introduction of communism in 1947 and stagnated at low levels during the whole communist period; (3) experienced a sharp rise with the return to capitalism in 1989. We find that official survey-based measures strongly under-estimate the rise in inequality since 1989. Our results highlight the prominent role of capital income in driving the U-shaped evolution of top income shares. The unique inequality history of Poland speaks to the central role of institutions and policies in shaping inequality in the long run.

PRESIDENT'S MESSAGE

PEDIATRICS ◽  
1962 ◽  
Vol 30 (1) ◽  
pp. 157-158
Author(s):  
Carl C. Fischer
Keyword(s):  
Whooping Cough ◽  
American People ◽  
Practice Of Medicine ◽  
The Subject ◽  
The Government ◽  
The Individual ◽  
The Cost ◽  
Federal Assistance ◽  
Children Under 5

REGARDLESS of how we, as individual physicians, may feel about the role of the federal government in the individual practice of medicine, the time has long since passed when we can afford the luxury of ignoring it. In past years the influence of the government on medicine has been mostly in general areas and perhaps least of all in that of pediatrics; but under the present administration there has been a decided change. For this reason it seems necessary to me to call to the attention of all Fellows of the Academy the particular items in President Kennedy's message of February 26, 1962, which relate specifically to the practice of Pediatrics. These may be considered to be three in number: The first of these dealt with the subject of immunization. On this topic President Kennedy said: I am asking the American people to join in a nationwide vaccination program to stamp out these four diseases (whooping cough, diphtheria, tetanus, and poliomyelitis) encouraging all communities to immunize both children and adults, keep them immunized and plan for the routine immunization of children yet to be born. To assist the states and local communities in this effort over the next 3 years, I am proposing legislation authorizing a program of federal assistance. This program would cover the full cost of vaccines for all children under 5 years of age. It would also assist in meeting the cost of organizing the vaccination drives begun during this period, and the cost of extra personnel needed for certain special tasks.

scholarly journals Taxing Capital? Not a Bad Idea After All!

2009 ◽  
Vol 99 (1) ◽  
pp. 25-48 ◽  
Author(s):  
Juan Carlos Conesa ◽  
Sagiri Kitao ◽  
Dirk Krueger
Keyword(s):  
Income Tax ◽  
Labor Income ◽  
Income Shocks ◽  
Capital Income ◽  
Overlapping Generations Model ◽  
Cycle Structure ◽  
Tax Rate ◽  
Average Household Income ◽  
Optimal Capital

We quantitatively characterize the optimal capital and labor income tax in an overlapping generations model with idiosyncratic, uninsurable income shocks and permanent productivity differences of households. The optimal capital income tax rate is significantly positive at 36 percent. The optimal progressive labor income tax is, roughly, a flat tax of 23 percent with a deduction of $7,200 (relative to average household income of $42,000). The high optimal capital income tax is mainly driven by the life-cycle structure of the model, whereas the optimal progressivity of the labor income tax is attributable to the insurance and redistribution role of the tax system. (JEL E13, H21, H24, H25)

Bhutan: The Role of the Constitutional Monarch in a Public Health Crisis

2021 ◽  
pp. 279-292
Author(s):  
Sonam Tshering ◽  
Nima Dorji
Keyword(s):  
Public Health ◽  
Artificial Intelligence ◽  
Health Crisis ◽  
Drug Smuggling ◽  
Personal Involvement ◽  
Public Health Crisis ◽  
The People ◽  
Long Run ◽  
The Government

This chapter reflects on Bhutan’s response to the Covid-19 pandemic. The people’s trust and confidence in the leadership of His Majesty the King, their government, strong Buddhist values to help each other, and the conscience of unity and solidarity proved their foremost strength in containing this pandemic as a nation. The king’s personal involvement helped guide, motivate, and encourage compliance with and support for the government’s response. However, Bhutan faced several challenges during the pandemic. Though most of the people are united, there are outliers who took advantage of the situation; there are reported cases of drug smuggling and one case of a person who escaped from quarantine. The government responded by increasing border patrols. In the long run, other solutions could be considered: installing a smart wall—using drones, sensors, and artificial intelligence patrols—would give Bhutan more control over its borders in the context of another epidemic while also enabling the government to better control smuggling.

scholarly journals Agro-industrialisation and financial intermediation in Nigeria

2020 ◽  
Vol 11 (3) ◽  
pp. 443-456 ◽  
Author(s):  
Ngozi Adeleye ◽  
Evans Osabuohien ◽  
Simplice Asongu
Keyword(s):  
Agricultural Sector ◽  
Explanatory Power ◽  
Value Added ◽  
Annual Data ◽  
Industrial Output ◽  
Industrial Growth ◽  
Content Type ◽  
Long Run ◽  
The Government

PurposeThe study aims to analyse the role of finance in the agro-industrialisation nexus in Nigeria using annual data on manufacturing value added, agricultural value added and volume of finance availed to the agricultural sector from 1981 to 2015.Design/methodology/approachTo establish the presence of a long-run relationship, the error correction model and bounds cointegration techniques are employed. Likewise, the model is augmented to test whether the associated relationship between industrial output and agricultural output depends on access to finance by farmers with the inclusion of an interaction term.FindingsSome salient contributions to the literature are as follows: agriculture and finance are strong and positive predictors of industrialisation in the long run; in the short run, past realisations of industrial output and finance have significant asymmetric effects on industrial output; the explanatory power of agriculture decreases with the growth of the financial system; and the long-run results validate the role of finance in the agro-industrialisation nexus.Originality/valueGiven these findings, achieving growth in the agricultural sector that will induce desired industrialisation should be prioritised by the government through agencies such as the central bank, financial intermediaries and other stakeholders with a view to making agricultural financing a major concern for sustainable domestic consumption and industrial growth.

The Circulation of Value in Civil Society and the State

Hegel's Value ◽  
2021 ◽  
pp. 222-275
Author(s):  
Dean Moyar
Keyword(s):  
Civil Society ◽  
Living Organism ◽  
The State ◽  
Executive Power ◽  
System P ◽  
Full Structure ◽  
The Government ◽  
The Individual ◽  
The Right

This chapter utilizes the structure of life and valid inference to analyze the internal structure of Civil Society and the State as well as the relationship between the two institutional spheres. The chapter unpacks the passage from the Logic in which Hegel describes the State as a totality of inferences with the three terms of individuals, their needs, and the government. It is shown that the “system of needs” itself forms a quasi-living institutional system of estates centered on the division of labor. This system’s inadequacy motivates the role of the “police” and corporation as ethical agencies, forms of the Good, within Civil Society. While the move to the State overcomes the individualism of “needs,” the right of the individual remains in the dynamics of “settling one’s own account” in receiving from the State a return on one’s duty to the State. Hegel treats the State proper as a constitution consisting of three powers of government that form a totality of inferential relations that has the full structure of a living organism. The executive power is examined in detail as the particularizing element in the system.

scholarly journals ANALISA RUH PENDIDIKAN KARAKTER DALAM PENDIDIKAN NASIONAL (UNDANG-UNDANG 2003)

2016 ◽  
Vol 1 (1) ◽  
pp. 90
Author(s):  
Syahrul Akmal Latif ◽  
Yusri Herman
Keyword(s):  
Immanuel Kant ◽  
Character Education ◽  
Moral Education ◽  
First Principle ◽  
National Unity ◽  
National Education ◽  
Education Act ◽  
The Government ◽  
The Individual

The issue of education is never over to talk about because education is one measurement of a person's individual accomplishments and achievements systematically nation. The high education of human resources will give a lot of useful works for the individual and social. Unfortunately, the education that was developed based on this character only strengthen individual and social, it’s beyond the divine value . It is due to the historical roots of the character education by Immanuel Kant (1724-1804) and Charles Renouvier (1815-1857); Religious morality in the low education and August Comter (1798- 1857); secular morality. Renouvier said the weakness of youth responsibility, loss of justice equality, respect and others. The process of character education is faced with the application of secularization. Such as, in France Francois Camille Jules Ferry (1832-1893) , a French Education minister said; Moral education is important but explicitely teaching morality does not needed. The development of character education in America is very dynamic. It’s started from 19th century (1900-1950) until 1997.It’s established nationally. Finally, Thomas lichona explained the entire role of religion in the education of character with seven steps and the role of teachers in character education. Thus, the author conducted religious analysis which widely spread among society is that the teaching of Protestant religious. But, It successfully gives individual and social value as character education. On the contrary, the goal of our national educational in 1945 (Version amendment) Article 31, paragraph 3 states: The Government shall manage and organize a national education system. Which increases the Faith and piety as well as noble character in order to educate the nation that adopted by law. Article 31, paragraph 5, states that the government advances science and technology to uphold the values of religious and national unity for the progress of civilization and prosperity of mankind. Likewise, the purpose of philosophy Nasionsl Education Act No. 20 of 2003. The 1945 Constitution and the Law N0 20 of 2003. Strongly reflects the value of belief in one God as the first principle of Pancasila as the first principle says it is an acknowledgment that in developing the nation's education should not be separated from human relations and slave relationship with God the creator.  

scholarly journals Disaster Response in Indonesia: Initiating Income Tax Policy Pro Disaster Mitigation

2020 ◽  
Vol 5 (2) ◽  
pp. 243-256
Author(s):  
Dini Dubelmar ◽  
Made Astrin Dwi Kartini ◽  
Sabila Mareli ◽  
Murwendah Murwendah
Keyword(s):  
Natural Disaster ◽  
Disaster Response ◽  
Income Tax ◽  
Field Studies ◽  
Disaster Mitigation ◽  
Disaster Insurance ◽  
Tax Allowance ◽  
Income Tax Policy ◽  
The Government

As a country with high potential for natural disaster, Indonesia can suffer from economic disruptions arising from significant decline in gross domestic income (GDP) due to financing losses caused by natural disaster. To reduce the risk of loss caused by natural disasters, the government has issued disaster mitigation policies in the form of structural and non-structural policies. In 2018, the government initiated a disaster mitigation policy in the form of natural disaster insurance prioritized to protect state assets. It does not exclude the possibility that this insurance shall be given to civil society, yet an issue arises regarding the source of funding for the insurance. Tax instruments are expected to be a policy innovation to overcome the issue of financing insurance. The purpose of this study is to explore the potential and role of fiscal policy through tax instruments in the context of disaster management in Indonesia. This study applied a qualitative approach and collected data through field studies and in-depth interviews. The findings of this study indicate that the natural disaster insurance policy may adopt the concept of tax allowance on donation and zakat as stipulated in Law No. 36 of 2008 on Income Tax. This incentive provides a tax facility in the form of tax allowance on income for calculating Income Tax. The policy is expected to attract the community to participate in natural disaster insurance amid the general lack of participation in insurance in Indonesia. On the other hand, the government obtains a source of revenue to finance disaster mitigation without disrupting the economy of the country.

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