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Optimal Income Taxation and International Labour Mobility[Note 1. I owe special thanks to Agnar Sandmo, David Wildasin, ...]
Author(s) -
Schjelderup G.
Publication year - 1997
Publication title -
bulletin of economic research
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.227
H-Index - 29
eISSN - 1467-8586
pISSN - 0307-3378
DOI - 10.1111/1467-8586.00045
Subject(s) - economics , residence , social welfare function , income tax , welfare , optimal tax , lump sum , international taxation , state income tax , gross income , jurisdiction , labour economics , transfer (computing) , microeconomics , public economics , tax reform , demographic economics , payment , market economy , finance , political science , law , parallel computing , computer science
This paper considers how a linear income tax should be set optimally when individuals are internationally mobile. The optimum tax analysis is founded on a social welfare function where each individual counts in the social welfare according to residence time in the home country. The discussion of the optimal income tax is organized from two perspectives. The first relates to the optimum income tax when a uniform lump sum transfer is used, while the second concerns the optimal rate of tax when a transfer is used which depends on time of residence in the taxing jurisdiction.