On Policy Relevance of Ramsey Tax Rules

Selim, S. 2007. On Policy Relevance of Ramsey Tax Rules. Economics Discussion Papers. 2007 (31) 2007-31.

TitleOn Policy Relevance of Ramsey Tax Rules
AuthorsSelim, S.
Abstract

The Ramsey approach to optimal taxation and Ramsey tax rules have amassed substance in economic theory. However, they are often criticized on grounds of practicality, fairness, feasibility and some other aspects of designing actual tax policy. This paper presents a collection of these views; it discusses how closely or remotely Ramsey rules are followed in designing tax policy. It presents some recent tax reforms in the US and in the UK that have closely, if not completely, followed the principle of distortion minimization. Despite the widely speculated difficulty associated with mapping normative tax rules into positive policy design, it is possible to implement taxes that have strong correspondence to Ramsey tax formulas. This paper also discusses why some implemented tax rules lack onsistency with Ramsey principles, or why it is often difficult to establish correspondence between some implemented taxes and Ramsey tax rules.

KeywordsRamsey Taxation, Policy Relevance, Capital Income Tax.
Article number2007-31
JournalEconomics Discussion Papers
Journal citation2007 (31)
ISSN1867-8009
Year2007
PublisherKiel Institute for the World Economy
Publisher's version
Web address (URL)http://www.economics-ejournal.org/economics/discussionpapers/2007-31/file
Publication dates
Published online13 Jul 2007
Published13 Jul 2007

Related outputs

Liberalization, bankers’ motivation and productivity: a simple model with an application
Luintel, K.B., Selim, S. and Bajracharya, P. 2017. Liberalization, bankers’ motivation and productivity: a simple model with an application. Economic Modelling. 61, pp. 102-112. https://doi.org/10.1016/j.econmod.2016.11.017

The impact of grain self-sufficiency regime on regional welfare and agricultural productivity in China
Selim, S. 2015. The impact of grain self-sufficiency regime on regional welfare and agricultural productivity in China. Agricultural Economics. 46, pp. 1-7. https://doi.org/10.1111/agec.12156

Reforms, incentives, welfare and productivity growth in Chinese wheat production
Patel, V. and Selim, S. 2014. Reforms, incentives, welfare and productivity growth in Chinese wheat production. Journal of Business and Policy Research. 9 (1), pp. 81-105. https://doi.org/10.21102/jbpr.2014.07.91.05

Labour productivity and rice production in Bangladesh: a stochastic frontier approach
Selim, S. 2012. Labour productivity and rice production in Bangladesh: a stochastic frontier approach. Applied Economics. 44 (5), pp. 641-652. https://doi.org/10.1080/00036846.2010.515203

Revisiting the capital tax ambiguity result
Selim, S. 2011. Revisiting the capital tax ambiguity result. Quantitative and Qualitative Analysis in Social Sciences. 5 (1), pp. 37-48.

Policy reforms and incentives in rice production in Bangladesh
Selim, S. and Parvin, N. 2010. Policy reforms and incentives in rice production in Bangladesh. Economics Bulletin. 30 (1), pp. 461-471.

Optimal taxation in a two sector economy with heterogeneous agents
Selim, S. 2010. Optimal taxation in a two sector economy with heterogeneous agents. Economics Bulletin. 30 (1), pp. 534-542.

Optimal Capital Income Taxation in a Two-Sector Economy
Selim, S. 2009. Optimal Capital Income Taxation in a Two-Sector Economy. in: Duffy, D. and Shinnick, E. (ed.) Public Goods, Public Policy and Taxation: A European Perspective Berlin LIT. pp. 179-198

Permalink - https://westminsterresearch.westminster.ac.uk/item/9z02y/on-policy-relevance-of-ramsey-tax-rules


Share this

Usage statistics

73 total views
289 total downloads
These values cover views and downloads from WestminsterResearch and are for the period from September 2nd 2018, when this repository was created.