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- 2022
- Chapter
Prioritarianism and Optimal Taxation
By: Matti Tuomala and Matthew Weinzierl
Prioritarianism has been at the center of the formal approach to optimal tax theory since its modern starting point in Mirrlees (1971), but most theorists’ use of it is motivated by tractability rather than explicit normative reasoning. We characterize analytically and...
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Keywords:
Prioritarianism;
Optimal Taxation;
Utilitarianism;
Redistribution;
Inverse-optimum;
Taxation;
Theory;
Policy
- Article
Democratizing Work: Redistributing Power in Organizations for a Democratic and Sustainable Future
Environmental destruction and social inequalities are increasingly urgent challenges. How can corporations, which have played a key role in creating and reproducing these problems, be part of the solution? In this paper, we advance that a shift to more democratic forms...
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- 2021
- Chapter
The Economic and Political Effects of Immigration: Evidence from the Age of Mass Migration
By: Marco Tabellini
Between 1850 and 1920, during the Age of Mass Migration, more than 30 million Europeans moved to the United States. European immigrants provided ample supply of cheap labor as well as specific skills and know-how, contributing to American economic growth. These...
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- July 2021
- Article
Redistribution through Markets
By: Piotr Dworczak, Scott Duke Kominers and Mohammad Akbarpour
Policymakers frequently use price regulations as a response to inequality in the markets they control. In this paper, we examine the optimal structure of such policies from the perspective of mechanism design. We study a buyer-seller market in which agents have private...
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- 2020
- Working Paper
Prioritarianism and Optimal Taxation
By: Matti Tuomala and Matthew C. Weinzierl
Prioritarianism has been at the center of the formal approach to optimal tax theory since its modern starting point in Mirrlees (1971), but most theorists’ use of it is motivated by tractability rather than explicit normative reasoning. We characterize analytically and...
View Details
Keywords:
Prioritarianism;
Optimal Taxation;
Utilitarianism;
Redistribution;
Inverse-optimum;
Taxation;
Theory
- September 2020
- Article
Dignity, Inequality, and the Populist Backlash: Lessons from America and Europe for a Sustainable Globalization
By: Rawi Abdelal
The greatest challenge to the sustainability of our current era of globalization comes from within the United States. Most Americans have come to reject globalization. We must discern the lessons from the parts of the developed world where the backlash is also...
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- 2022
- Working Paper
Optimal Illiquidity
By: John Beshears, James J. Choi, Christopher Clayton, Christopher Harris, David Laibson and Brigitte C. Madrian
We calculate the socially optimal level of illiquidity in an economy populated by households with taste shocks and naive present bias. The government chooses mandatory contributions to accounts, each witha different pre-retirement withdrawal penalty. Collected...
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Keywords:
Illiquidity;
Commitment;
Flexibility;
Savings;
Social Security;
Retirement;
Government Legislation;
Taxation;
Saving
- 2020
- Working Paper
Dignity, Inequality, and the Populist Backlash: Lessons from America and Europe for a Sustainable Globalization
By: Rawi Abdelal
The greatest challenge to the sustainability of our current era of globalization comes from within the United States. Most Americans have come to reject globalization. We must discern the lessons from the parts of the developed world where the backlash is also...
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- 2023
- Working Paper
The Seeds of Ideology: Historical Immigration and Political Preferences in the United States
By: Paola Giuliano and Marco Tabellini
We study the long run effects of immigration on American political ideology. Exploiting cross-county variation in the presence of European immigrants between 1900 and 1930, we establish a novel result: historical European immigration is associated with stronger...
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- July 2018 (Revised November 2018)
- Case
The Robin Hood Army
By: Susanna Gallani
In 2014, Neel Ghose and a handful of friends spent one evening distributing excess food they had collected from local restaurants to the less fortunate people living under the Hauz Khas flyover in South Delhi. Four years later, this initiative had developed into The...
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- Article
(Mis)perceptions of Inequality
By: Oliver P. Hauser and Michael I. Norton
Inequality is arguably the defining societal issue of the 21st century. The debate over “who gets what’ underlies policy debates ranging from taxation to health care to wages and permeates society at all levels, attracting increasing interest from policymakers,...
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- 2017
- Working Paper
A Welfarist Role for Nonwelfarist Rules: An Example with Envy
I propose and formalize an argument for why economists working in the welfarist normative tradition should include nonwelfarist principles in how they judge economic policy. The key idea behind this argument is that the world is too complex, and our ability to model it...
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- Article
Optimal Taxation When Children's Abilities Depend on Parents' Resources
By: Alexander Gelber and Matthew Weinzierl
Empirical research suggests that parents' economic resources affect their children's future earnings abilities. Optimal tax policy therefore treats future ability distributions as endogenous to current taxes. We model this endogeneity, calibrate the model to match...
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- Article
De Gustibus non est Taxandum: Heterogeneity in Preferences and Optimal Redistribution
By: Benjamin B Lockwood and Matthew Weinzierl
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...
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- Article
The Not-So-Common-Wealth of Australia: Evidence for a Cross-Cultural Desire for a More Equal Distribution of Wealth.
By: Michael I. Norton, David T. Neal, Cassandra L. Govan, Dan Ariely and Elise Holland
Recent evidence suggests that Americans underestimate wealth inequality in the United States and favor a more equal wealth distribution (Norton & Ariely, 2011). Does this pattern reflect ideological dynamics unique to the United States, or is the phenomenon evident in...
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- October 2014
- Article
The Promise of Positive Optimal Taxation: Normative Diversity and a Role for Equal Sacrifice
A prominent assumption in modern optimal tax research is that the objective of taxation is Utilitarian. I present new survey evidence that most people disagree with this assumption, preferring tax policies based at least in part on a classic alternative objective: the...
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- September 2014
- Article
Income Inequality and Social Preferences for Redistribution and Compensation Differentials
By: William R. Kerr
In cross-sectional studies, countries with greater income inequality typically exhibit less support for government-led redistribution and greater acceptance of wage inequality (e.g., United States versus Western Europe). If individual nations evolve along this pattern,...
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- February 2014
- Article
'Last-place Aversion': Evidence and Redistributive Implications
By: Ilyana Kuziemko, Ryan W. Buell, Taly Reich and Michael Norton
We present evidence from laboratory experiments showing that individuals are "last-place averse." Participants choose gambles with the potential to move them out of last place that they reject when randomly placed in other parts of the distribution. In...
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- 2012
- Working Paper
~Why Do We Redistribute so Much but Tag so Little? Normative Diversity, Equal Sacrifice and Optimal Taxation
Tagging is a free lunch in conventional optimal tax theory because it eases the classic tradeoff between efficiency and equality. But tagging is used in only limited ways in tax policy. I propose one explanation: conventional optimal tax theory has yet to capture the...
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- 2014
- Working Paper
De Gustibus non est Taxandum: Heterogeneity in Preferences and Optimal Redistribution
By: Benjamin B Lockwood and Matthew Weinzierl
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...
View Details