Benjamin B Lockwood
Ben received his B.A. in Philosophy and Economics from Amherst College in 2008. He then worked as an economics research assistant at Columbia Business School, studying housing policy and the economics of education. His research interests include computational economics, behavioral economics, and the philosophy of economics.
De Gustibus non est Taxandum: Heterogeneity in Preferences and Optimal Redistribution
The prominent but unproven intuition that preference heterogeneity reduces redistribution in a standard optimal tax model is shown to hold under the plausible condition that the distribution of preferences for consumption relative to leisure rises, in terms of first-order stochastic dominance, with income. Given mainstream functional form assumptions on utility and the distributions of ability and preferences, a simple statistic for the effect of preference heterogeneity on marginal tax rates is derived. Numerical simulations and suggestive empirical evidence demonstrate the link between this potentially measurable statistic and the quantitative implications of preference heterogeneity for policy.