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SAVING, INVESTMENT, AND TAXATION IN UNDERDEVELOPED COUNTRIES
Author(s) -
Tanzi Vito,
Aschheim Joseph
Publication year - 1965
Publication title -
kyklos
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.766
H-Index - 58
eISSN - 1467-6435
pISSN - 0023-5962
DOI - 10.1111/j.1467-6435.1965.tb02479.x
Subject(s) - economics , incentive , consumption (sociology) , investment (military) , distribution (mathematics) , context (archaeology) , developing country , capital (architecture) , double taxation , tax incentive , income tax , international taxation , public economics , monetary economics , tax reform , labour economics , microeconomics , economic growth , history , mathematical analysis , social science , paleontology , mathematics , archaeology , sociology , politics , political science , law , biology
SUMMARY The present paper is concerned with the relationship between the distribution of the tax burden on the one hand, and (a) the propensity to save as well as (b) the incentive to invest in underdeveloped economies on the other hand. The approach is one of analyzing the effects of a progressive income tax in the context of D uesenberry's theory of the consumption function. This leads us to the proposal of a system of taxation with high progressive rates on the incomes of individuals coupled with low rates, or no tax at all, on the incomes of corporations and on unrealized capital gains.