TY - JOUR
T1 - An empirically based just linear income tax system
AU - Jasso, Guillermina
AU - Wegener, Bernd
N1 - Funding Information:
Earlier versions of portions of this paper were presented at the annual meeting of the Econometric Society, San Francisco, CA, December 1983; the annual Group Processes Conference, Las Vegas, NV, August 2011; the Fifth Joint Japan-North America Mathematical Sociology Conference, Denver, CO, August 2012; the annual meeting of the American Sociological Association, Denver, CO, August 2012; the 14 Biennial Conference of the International Society for Justice Research (ISJR), Rishon LeZion, Israel, September 2012; at the Conference of the Research Committee 28 on Social Stratification of the International Sociological Association (ISA-RC28), Trento, Italy, May 2013; at the Joint Statistical Meetings, Montreal, Canada, August 2013; and at the annual meeting of the American Sociological Association (ASA), New York, NY, August 2013. We thank participants at those conferences and especially Leslie McCall, Maria Metzing, James M. Poterba, Yoshimichi Sato, Simone Schneider, Christian Seidl, Kenneth D. Simonson, anonymous referees, and the Editor for valuable comments and suggestions. We also gratefully acknowledge the intellectual and financial support of Humboldt University and New York University. th
Publisher Copyright:
© 2020 Taylor & Francis Group, LLC.
Copyright:
Copyright 2020 Elsevier B.V., All rights reserved.
PY - 2022
Y1 - 2022
N2 - This paper develops and illustrates a method for empirically designing an income tax system that people will regard as fair. The paper begins with the classical Principles of Tax Justice, viz., as pretax income increases, three quantities should also increase–posttax income, tax amount, and tax rate. GSOEP data on residents’ pretax income and the posttax income they regard as fair are used to estimate a just linear income tax system. Analytic results include a signature standard form of the tax system showing the intertwined fates of poor and rich and the conditions which threaten fairness. Empirical results show that the estimated tax system lowers taxes for a majority of respondents, especially the relatively poorer, and substantially reduces inequality.
AB - This paper develops and illustrates a method for empirically designing an income tax system that people will regard as fair. The paper begins with the classical Principles of Tax Justice, viz., as pretax income increases, three quantities should also increase–posttax income, tax amount, and tax rate. GSOEP data on residents’ pretax income and the posttax income they regard as fair are used to estimate a just linear income tax system. Analytic results include a signature standard form of the tax system showing the intertwined fates of poor and rich and the conditions which threaten fairness. Empirical results show that the estimated tax system lowers taxes for a majority of respondents, especially the relatively poorer, and substantially reduces inequality.
KW - Principles of tax justice
KW - inequality
KW - just linear income tax system
UR - http://www.scopus.com/inward/record.url?scp=85098649670&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=85098649670&partnerID=8YFLogxK
U2 - 10.1080/0022250X.2020.1859501
DO - 10.1080/0022250X.2020.1859501
M3 - Article
AN - SCOPUS:85098649670
SN - 0022-250X
VL - 46
SP - 195
EP - 225
JO - Journal of Mathematical Sociology
JF - Journal of Mathematical Sociology
IS - 2
ER -