Readings

Useful General References

Atkinson, A., and J. Stiglitz. Lectures on Public Economics. Mcgraw-Hill College, 1980. ISBN: 9780070841055.

Auerbach, A., and M. Feldstein. Handbook of Public Economics. Vol 1. North Holland, 1985. ISBN: 9780444548931.

———. Handbook of Public Economics. Vol 2. North Holland, 1987. ISBN: 9780444879080.

———. Handbook of Public Economics. Vol 3. North Holland, 2002. ISBN: 9780444823144.

———. Handbook of Public Economics. Vol 4. North Holland, 2002. ISBN: 9780444823151.

Gruber, J. Public Finance and Public Policy. 3rd ed. Worth Publishers, 2009. ISBN: 9781429219495.

Institute for Fiscal Studies. Dimensions of Tax Design: The Mirrlees Review. Oxford University Press, 2010. ISBN: 9780199553754.

Myles, G. Public Economics. Cambridge University Press, 1995. ISBN: 9780521497695.

Buy at MIT Press Slemrod, J., and J. Bakija. Taxing Ourselves: A Citizen’s Guide to the Debate over Taxes. MIT Press, 2008. ISBN: 9780262195737.

U. S. Congress, Congressional Budget Office. The Budget and Economic Outlook: An Update. BiblioGov, 2012. ISBN: 9781249915164.

SES # TOPICS READINGS
PART I
Introduction to Tax Analysis
1 The Efficiency Costs of Taxation

Chetty, R., A. Looney, et al. “ Salience and Taxation: Theory and Evidence.” American Economic Review 99, no. 4 (2009): 1145–77.

Congdon, W., J. Kling, and S. Mullainathan. Policy and Choice: Public Finance through the Lens of Behavioral Economics. Brookings Institution Press, 2011. ISBN: 9780815722588.

Diamond, P., and D. McFadden. “ Some Uses of the Expenditure Function in Public Finance.” Journal of Public Economics 5, no. 3–4 (1976): 373–79.

Einav, L., D. Knoepfle, et al. “ Sales Taxes and Internet Commerce.” NBER Working Paper, no. 18018, April 2012.

Ellison, G., and S. Ellison. “ Tax Sensitivity and Home State Preferences in Internet Purchasing.” American Economic Journal: Economic Policy 1, no. 2 (2009): 53–71.

Buy at MIT Press Evans, W., J. Ringel, and D. Stech. “Tobacco Taxes and Public Policy to Discourage Smoking.” In Tax Policy and the Economy. Vol 13. Edited by J. Poterba. MIT Press, 1999, pp. 1–56. ISBN: 9780262161855.

Goulder, L., and R. Williams. “ The Substantial Bias from Ignoring General Equilibrium Effects in Estimating Excess Burden, and a Practical Solution.” Journal of Political Economy 111 (2003): 898–927.

Gruber, J., and B. Koszegi. “ Tax Incidence When Individuals Are Time-Inconsistent: The Case Of Cigarette Excise Taxes.Journal of Public Economics 88, no. 9–10 (2004): 1959–87.

Harding, M., E. Leibtag, et al. “The Heterogeneous Geographic and Socioeconomic Incidence of Cigarette Taxes: Evidence from Neilsen Homescan Data.” (PDF) mimeo, Stanford University, 2010.

Hausman, J. “ Exact Consumers Surplus and Deadweight Loss.” American Economic Review 71, no. 4 (1981): 622–76.

Hausman, J., and W. Newey. “ Nonparametric Measurement of Exact Consumers Surplus and Deadweight Loss.” Econometrica 63 (1995): 1445–76.

Manning, W., Willard, et al. “ The Taxes of Sin: Do Smokers and Drinkers Pay Their Way?Journal of the American Medical Association 261, no. 11 (1989): 1604–9.

Marion, J., and E. Muehlegger. “ Measuring Illegal Activity and the Effects of Regulatory Innovation: A Study of Diesel Fuel Tax Evasion.” Journal of Political Economy 116 (2008): 633–66.

Buy at MIT Press Salanie, B. Chapter 1 in Economics of Taxation. MIT Press, 2011. ISBN: 9780262016346.

2 General Equilibrium Tax Incidence

Atkinson, A., and J. Stiglitz. Chapter 6 in Lectures on Public Economics. McGraw Hill College, 1980. ISBN: 9780070841055.

Ballard, C., D. Fullerton, et al. Chapters 2, and 3 in A General Equilibrium Model for Tax Policy Evaluation. University of Chicago Press, 1985. ISBN: 9780226036328.

Bradford, D. “ Factor Prices May be Constant but Factor Returns are Not.” Economic Letters 1, no. 3 (1978): 199–203.

Cutler, D. “Tax Reform and the Stock Market: An Asset Price Approach.” (PDF - 1.6MB) American Economic Review 78, no. 5 (1988): 1107–17.

Fullerton, D., and G. Metcalf. “ Tax Incidence.” In Handbook of Public Economics. Vol 4. Edited by A. Auerbach, and M. Feldstein. North Holland, 2002. ISBN: 9780444823151.

Gravelle, J., and K. Smetters. “ Does the Open Economy Assumption Really Mean That Labor Bears the Burden of a Capital Income Tax?Advances in Economic Analysis & Policy 6, no. 1 (2006).

Harberger, A. “The Incidence of the Corporation Income Tax.” (PDF - 3.8MB) Journal of Political Economy 70 (1962): 215–40.

Poterba, J. “Tax Subsidies to Owner-Occupied Housing: An Asset Market Approach.” (PDF - 1.9MB) Quarterly Journal of Economics 99, no. 4 (1984): 729–52.

Stroebel, J., and M. Floetotto. “ Government Intervention in the Housing Market: Who Wins, Who Loses?” mimeo, Stanford University Economics, 2010.

Taxation and Labor Supply—Empirical Work
3 Married Men

Buy at MIT Press Alesina, A., E. Glaeser, and B. Sacerdote. “Work and Leisure in the U.S. and Europe: Why So Different?” In NBER Macroeconomics Annual 2005. Edited by D. Acemoglu, and K. Rogoff. MIT Press, 2006, pp. 1–64. ISBN: 9780262072724.

Blomquist, S. “ Restrictions in Labor Supply Estimation: Is the MaCurdy Critique Correct?Economics Letters 47, no. 3–4 (1995): 229–35.

———. “ Estimation Methods for Male Labor Supply Functions: How to Take Account of Nonlinear Taxes.” Journal of Econometrics 70, no. 2 (1996): 383–405.

Blomquist, S., M. Eklof, et al. “ Tax Reform Evaluation Using Nonparametric Methods: Sweden 1980-1991.” Journal of Public Economics 79, no. 3 (2001): 543-68.

Blundell, R., A. Duncan, et al. “ Estimating Labor Supply Responses Using Tax Reforms.” Econometrica 66, no. 4 (1998): 827–62.

Blundell, R., and T. MaCurdy. “Labor Supply: A Review of Alternative Approaches.” In Handbook of Labor Economics. Vol 3. Edited by A. Ashenfelter, and D. Card. North Holland, 1999, pp. 1569–1695. ISBN: 9780444822895.

Chetty, R. “ Bounds on Elasticities with Optimization Frictions: A Synthesis of Micro and Macro Evidence on Labor Supply.” Econometrica 80, no. 3 (2012): 969–1018.

Chetty, R., J. Friedman, et al. “ Adjustment Costs, Firm Responses, and Micro vs. Macro Labor Supply Elasticities: Evidence from Danish Tax Records.” Quarterly Journal of Economics 126 (2011): 749–804.

Davis, S., and M. Henrekson. “Tax Effects on Work Activity, Industry Mix, and Shadow Economy Size: Evidence from Rich Country Comparisons.” In Labour Supply and Incentives to Work in Europe. Edited by R. Salvador, et al. Edward Elgar Publishing, pp. 44–104. ISBN: 9781845421298.

Eissa, N., H. Kleven, et al. “ Evaluation of Four Tax Reforms in the United States: Labor Supply and Welfare Effects for Single Mothers.” Journal of Public Economics 92, no. 3–4 (2008): 795–816.

Eklof, M., and H. Sacklen. “ The Hausman-MaCurdy Controversy: Why Do the Results Differ Across Studies?Journal of Human Resources 35, no. 1 (2000): 204–20.

Fullerton, D. “Reconciling Recent Estimates of the Marginal Welfare Cost of Taxation.” American Economic Review 81, no. 1 (1991): 302–08.

Gelber, A., D. Jones, et al. “ Individual Earnings Adjustment to Policy: Evidence from the Social Security Earnings Test.” mimeo, Wharton School, 2012.

Hausman, J. “Labor Supply.” In How Taxes Affect Economic Behavior. Edited H. Aaron, and J. Pechman. Brookings Institution, 1981, pp. 27–83. ISBN: 9780815700111.

Heckman, J. “Comment.” In Behavioral Simulations in Tax Policy Analysis. Edited by M. Feldstein. University of Chicago Press, 1982, pp. 70–82. ISBN: 9780226240848.

Imbens, G., D. Rubin, et al. “ Estimating the Effect of Unearned Income on Labor Earnings, Savings, and Consumption: Evidence from a Survey of Lottery Winners.” American Economic Review 91, no. 4 (2001): 778–94.

Keane, M. “ Labor Supply and Taxes: A Survey.” Journal of Economic Literature 49, no. 4 (2011): 961–1075.

Kleven, H., C. Landais, et al. “ Taxation and International Migration of Superstars: Evidence from the European Football Market.” NBER Working Paper, no. 16545. (forthcoming, American Economic Review).

Kumar, A. “ Labor Supply, Deadweight Loss, and the Tax Reform Act of 1986: A Nonparametric Evaluation Using Panel Data.” Journal of Public Economics 92, no. 1–2 (2008): 236–53.

Ljunge, M., and K. Ragan. “Labor Supply and the Tax Reform of the Century.” mimeo, University of Chicago, 2005.

Buy at MIT Press Ljungqvist, L., and T. Sargent. “Do Taxes Explain European Employment? Indivisible Labor, Human Capital, Lotteries, and Saving.” In NBER Macroeconomics Annual 2006. Edited by D. Acemoglu, K. Rogoff, and M. Woodford. MIT Press, 2007, pp. 181–244. ISBN: 9780262512008.

———. “Career Length: Effects of Curvature of Earnings Profiles, Earnings Shocks, and Social Security” (PDF). NYU Economics Working Paper, 2010.

MaCurdy, T. “An Empirical Model of Labor Supply in a Lifecycle Setting.” (PDF - 1.1MB) Journal of Political Economy 89, no. 6 (1981): 1059–85.

———. “Work Disincentive Effects of Taxes: A Reexamination of Some Evidence.” American Economic Review 80 (1992): 243–9.

Meghir, C., and D. Phillips. “Labor Supply and Taxes.” (PDF) Dimensions of Tax Design: The Mirrlees Review. Edited by Institute for Fiscal Studies. Oxford University Press, 2010. ISBN: 9780199553754.

Moffitt, R., and M. Wilhelm. “Taxes and Labor Supply Decisions of the Affluent.” In Does Atlas Shrug? The Economic Consequences of Taxing the Rich. Edited by J. Slemrod. Russell Sage Foundation, 2000, pp. 193–234. ISBN: 9780674001541. [Preview with Google Books]

Ohanian, L., A. Raffo, et al. “ Long-Term Changes in Labor Supply and Taxes: Evidence from OECD Countries, 1956-2004.” Journal of Monetary Economics 55, no. 8 (2008): 1353–62.

Prescott, E. “Why Do Americans Work So Much More Than Europeans?” (PDF) Federal Reserve Bank of Minneapolis Review 28, no. 1 (2004): 2–13.

Rogerson, R. “ Taxation and Market Work: Is Scandinavia an Outlier?Economic Theory 32, no. 1 (2007): 59–85.

Rogerson, R., and J. Wallenius. “Micro and Macro Elasticities in a Life Cycle Model with Taxes.” (PDF) Journal of Economic Theory 144, no. 6 (2009): 2277–92.

Saez, E. “ Do Tax Filers Bunch at Kink Points?American Economic Journal: Economic Policy 2, no. 3 (2010): 180–212.

Showalter, M., and N. Thurston. “ Taxes and Labor Supply of High-Income Physicians.” Journal of Public Economics 66, no. 1 (1997): 73–97.

Ziliak, J., and T. Kniesner. “ Estimating Life Cycle Labor Supply Tax Effects.” Journal of Political Economy 107, no. 2 (1999): 326–59.

4 Taxation and the Labor Supply of Married Women

Blau, F., and L. Kahn. “Changes in the Labor Supply Behavior of Married Women, 1980-2000.” (PDF) Journal of Labor Economics 25 (2007): 393–438.

Eissa, N. “Taxation and Labor Supply of Married Women: The Tax Reform Act of 1986 as a Natural Experiment.” (PDF) NBER Working Paper, no. 5023, Febraury 1995.

Gelber, A. “Taxation and Family Labor Supply.” (PDF) mimeo, Wharton School, 2008.

Mroz, T. “The Sensitivity of an Empirical Model of Married Women’s Hours of Work to Economic and Statistical Assumptions.” (PDF - 3.4MB) Econometrica 55, no. 4 (1987): 765–99.

Selin, H. “ The Rise in Female Employment and the Role of Tax Incentives: An Empirical Analysis of the Swedish Individual Tax Reform of 1971.” CESifo Working Paper, no. 2629, April 2009.

Triest, R. “ The Effect of Income Taxation on Labor Supply in the United States.” Journal of Human Resources 25, no. 3 (1990): 491–516.

5 The Earned Income Tax Credit: Taxes and Labor Supply at Low Incomes

Beaudry, P., C. Blackorby, et al. “ Taxes and Employment Subsidies in Optimal Redistribution Programs.” American Economic Review 99, no. 1 (2009): 261–42.

Blundell, R. and A. Shephard. “ Employment, Hours of Work, and the Optimal Taxation of Low-Income Families.” Review of Economic Studies 79 (2012): 481–510.

Cancian, M., and A. Levinson. “Labor Supply Effects of the EITC: Evidence from Wisconsin’s Supplemental Benefit for Families with Three Children.” (PDF) National Tax Journal 59, no. 4 (2006): 781–800.

Chetty, R., and E. Saez. “Teaching the Tax Code: Earnings Responses to an Experiment with EITC Recipients.” (PDF - 1.4MB) NBER Working Paper, no. 14836, December 2009. (forthcoming, American Economic Journal: Applied Economics)

Eissa, N., and H. Hoynes. “ Taxes and the Labor Market Participation of Married Couples: The Earned Income Tax Credit.” Journal of Public Economics 88, no. 9–10 (2004): 1931–58.

Eissa, N., and J. Liebman. “ Labor Supply Response to the Earned Income Tax Credit.” Quarterly Journal of Economics 111, no. 2 (1996): 605–37.

Hotz, V., and J. K. Scholz. “The Earned Income Tax Credit.” In Means-Tested Welfare Programs in the United States. Edited by Robert Moffitt. University of Chicago Press, 2003, pp. 141–98. ISBN: 9780226533568.

Meyer, B. “ Labor Supply at the Extensive and Intensive Margins: The EITC, Welfare, and Hours Worked.” American Economic Review 92, no. 2 (2002): 373–9.

Meyer, B., and D. Rosenbaum. “Making Single Mothers Work: Recent Tax and Welfare Policy and Its Effects.” (PDF - 1.7MB) National Tax Journal 53 (2000, Part 2): 1027–61.

Rothstein, J. “The Unintended Consequences of Encouraging Work: Tax Incidence and the EITC.” (PDF) Working paper, no. 165, Princeton University, May 2008.

———. “ Is the EITC as Good as an NIT? Conditional Cash Transfers and Tax Incidence.” American Economic Journal: Economic Policy 2, no. 1 (2010): 177–208.

 
6 Tax Rates and Taxable Income

Bastani, S., and H. Selin. “Bunching and Non-Bunching at Kink Points of the Swedish Tax Schedule.” (PDF) Working Paper 2011:12, Uppsala Center for Fiscal Studies.

Chetty, R. “ Is the Taxable Income Elasticity Sufficient to Calculate Deadweight Loss? The Implications of Evasion and Avoidance.” American Economic Journal: Economic Policy 1, no. 2 (2009): 31–52.

———. “Bounds on Elasticities with Optimization Frictions: An Application to Taxation and Labor Supply.” (PDF) NBER Working Paper, no. 15616, December 2009.

Buy at MIT Press Feenberg, D., and J. Poterba. “Income Inequality and the Incomes of High Income Taxpayers: Evidence from Tax Returns.” In Tax Policy and the Economy. Vol 7. Edited by J. Poterba. MIT Press, 1993, pp. 145–73. ISBN: 9780262660815.

Feldstein, M. “ The Effects of Marginal Tax Rates on Taxable Income: A Panel Study of the 1986 Tax Reform.” Journal of Political Economy 103, no. 3 (1995): 551–71.

Gruber, J., and E. Saez. “The Elasticity of Taxable Income: Evidence and Implications.” (PDF) Journal of Public Economics 84 (2002): 1–32.

Kopczuk, W. “ Tax Bases, Tax Rates and the Elasticity of Reported Income.” Journal of Public Economics 89 (2004): 2093–119.

Piketty, T., E. Saez, et al. “Optimal Taxation of Top Labor Incomes: A Tale of Three Elasticities.” (PDF) NBER Working Paper, no. 17616, November 2011.

Romer, C., and D. Romer. “The Incentive Effects of Marginal Tax Rates: Evidence from the Interwar Era.” (PDF) NBER Working Paper, no. 17860, November 2012.

Saez, E., J. Slemrod, et al. “The Elasticity of Taxable Income with Respect to Marginal Tax Rates: A Critical Review.” (PDF) Journal of Economic Literature 50, no. 1 (2012): 3–50.

Trabandt, M., and H. Uhlig. “How Far Are We From the Slippery Slope? The Laffer Curve Revisited.” (PDF) NBER Working Paper, no. 15343, September 2009.

7 Tax Expenditures

Burman, L., and W. Randolph. “Measuring Permanent Responses to Capital-Gains Tax Changes in Panel Data.” (PDF - 2.1MB) American Economic Review 84, no. 4 (1994): 794–809.

Buy at MIT Press Gruber, J. “Taxes and Health Insurance.” (PDF) In Tax Policy and the Economy. Vol 16. Edited by J. Poterba. MIT Press, 2002, pp. 37–66. ISBN: 9780262661294.

Gruber, J., and E. Washington. “ Subsidies to Employee Health Insurance Premiums and the Health Insurance Market.Journal of Health Economics 24, no. 2 (2005): 253–76.

Poterba, J., and T. Sinai. “ Revenue Costs and Incentive Effects of the Mortgage Interest Deduction for Owner-Occupied Housing.” National Tax Journal 64, no. 2 (2011): 531–64.

Empirical Aspects of Taxing Capital Income
8 Capital Income, Wealth, and Saving Behavior: Stylized Facts and Model Formulation

Bricker, J., A. Kennickell, et al. “Changes in U.S. Family Finances from 2007 to 2010: Evidence from the Survey of Consumer Finances.” (PDF) Federal Reserve Bulletin 98, no. 2 (2012): 1–80.

Altonji, J., F. Hayashi, et al. “ Parental Altruism and Inter Vivos Transfers: Theory and Evidence.” Journal of Political Economy 105, no. 6 (1997): 1121–66.

Bernheim, B., A. Shleifer, et al. “ The Strategic Bequest Motive.” Journal of Political Economy 93, no. 6 (1985): 1045–76.

Bernheim, B., and S. Severinov. “Bequests as Signals: An Explanation for the Equal Division Puzzle.” (PDF) Journal of Political Economy 111, no. 4 (2003): 733–64.

De Nardi, M., E. French, et al. “ Why do the Elderly Save? The Role of Medical Expenses.” Journal of Political Economy 118, no. 1 (2010): 39–75.

Dynan, K., J. Skinner, et al. “Do the Rich Save More?” (PDF) Journal of Political Economy 112, no. 2 (2004): 397–444.

Kotlikoff, L. “ Intergenerational Transfers and Saving.” Journal of Economic Perspectives 2, no. 2 (1988): 41–58.

Modigliani, F. “The Role of Intergenerational Transfers and Lifecycle Saving in the Accumulation of Wealth.” (PDF) Journal of Economic Perspectives 2, no. 2 (1988): 15–40.

Poterba, J., S. Venti, et al. “ The Composition and Draw-Down of Wealth in Retirement.” Journal of Economic Perspectives 25, no. 4 (2011): 95–118.

———. “Were They Prepared for Retirement? Financial Status at Advanced Ages in the HRS and AHEAD Cohorts.” In Investigations in the Economics of Aging. Edited by D. Wise. University of Chicago Press, 2012, pp. 21–69. ISBN: 9780226903132. [Preview with Google books]

Wilhelm, M. “Bequest Behavior and the Effect of Heirs Earnings: Testing the Altruistic Model of Bequests.” American Economic Review 86, no. 4 (1996): 874–92.

9 Tax Policy, Rates of Return, and Saving

Angeletos, G. -M., D. Laibson, et al. “ The Hyperbolic Consumption Model: Calibration, Simulation, and Empirical Evaluation.” Journal of Economic Perspectives 15, no. 3 (2001): 47–68.

Atkinson, A., and J. Stiglitz. Chapter 3 in Lectures in Public Economics. Mcgraw-Hill College, 1980. ISBN: 9780070841055.

Attanasio, O., and M. Wakefield. “The Effect on Consumption and Saving of Taxing Asset Returns.” Dimensions of Tax Design: The Mirrlees Review. Edited by Institute for Fiscal Studies. Oxford University Press, 2010, pp. 675–763. ISBN: 9780199553754.

Attanasio, O., and G. Weber. “ Consumption and Saving: Models of Intertemporal Allocation and their Implications for Public Policy.” Journal of Economic Literature 48, no. 3 (2010): 693–751.

Barsky, R., T. Juster, et al. “Preference Parameters and Behavioral Heterogeneity: An Experimental Approach in the Health and Retirement Study.” (PDF) Quarterly Journal of Economics 112, no. 2 (1997): 537–79.

Boskin, M. “ Taxation, Savings, and the Rate of Interest.” Journal of Political Economy 86, no. 2 (1978): S3–27.

Gruber, J. “ A Tax-Based Estimate of the Elasticity of Intertemporal Substitution.” NBER Working Paper, no. 11945, January 2006.

Hall, R. “Intertemporal Substitution in Consumption.” (PDF - 1.6MB) Journal of Political Economy 96, no. 2 (1988): 339–57.

McGrattan, E. “ Capital Taxation During the Great Depression.” Quarterly Journal of Economics 127, no. 3 (2012): 1515–50.

Mulligan, C. “ What Do Aggregate Consumption Euler Equations Say About the Capital Income Tax Burden?.” American Economic Review 94, no. 2 (2004): 166–70.

Ogaki, M., and C. Reinhart. “ Measuring Intertemporal Substitution: The Role of Durable Goods.” Journal of Political Economy 106, no. 5 (1998): 1078–98.

Summers, L. “ Capital Taxation and Accumulation in a Life Cycle Model.” American Economic Review 71, no. 4 (1981): 533–44.

Vissing-Jorgensen, A. “ Limited Asset Market Participation and the Elasticity of Intertemporal Substitution.” Journal of Political Economy 110 (2002): 825–53.

10 Tax Reform: Income Taxes vs. Consumption Taxes

Altig, D., A. Auerbach, et al. “ Simulating Fundamental Tax Reform in the United States.” American Economic Review 91, no. 3 (2001): 574–95.

Auerbach, A. “The Choice Between Income and Consumption Taxes: A Primer.” (PDF) In Institutional Foundations of Public Finance: Economic and Legal Perspectives. Edited by A. Auerbach, and D. Shaviro. Harvard University Press, 2009. ISBN: 9780674030978. [Preview with Google Books]

Auerbach, A., and L. Kotlikoff. Chapter 5 Dynamic Fiscal Policy. Cambridge University Press, 1987. ISBN: 9780521300414.

McLure, C. The Value Added Tax: Key to Deficit Reduction. American Enterprise Institute, 1988. ISBN: 9780844736136.

Poterba, J. “Lifetime Incidence and the Distributional Burden of Excise Taxes.” (PDF - 1.1MB) American Economic Review 79, no. 2 (1989): 325–30.

11 Targeted Tax Subsidies to Saving

Agnew, J., P. Balduzzi, et al. “ Portfolio Choice and Trading in a Large 401(k) Plan.” American Economic Review 93, no. 1 (2003): 193–215.

Benjamin, D. “ Does 401(k) Eligibility Increase Saving? Evidence from Propensity Score Subclassification.” Journal of Public Economics 87, no. 5–6 (2003): 1259–90.

Bronchetti, E., T. Dee, et al. “ When a Nudge Isn’t Enough: Defaults and Saving Among Low-Income Tax Filers.” NBER Working Paper, no. 16887, 2011.

Carroll, G., J. Choi, et al. “Optimal Defaults and Active Decisions: Theory and Evidence from 401(k) Saving.” (PDF - 2.8MB) Quarterly Journal of Economics 124 (2009): 1639–74.

Duflo, E., W. Gale, et al. “ Saving Incentives for Low and Middle-Income Families: Evidence from a Field Experiment with H&R Block.” Quarterly Journal of Economics 121, no. 4 (2006): 1311–46.

Duflo, E., and E. Saez. “ Participation and Investment Decisions in a Retirement Plan: The Influence of Colleagues’ Choices.” Journal of Public Economics 85, no. 1 (2002): 121–48.

Engelhardt, G., and A. Kumar. “ Employer Matching and 401(k) Saving: Evidence from the Health and Retirement StudyJournal of Public Economics 91, no. 10 (2007): 1920–43.

Engen, E., W. Gale, et al. “ The Illusory Effects of Saving Incentives on Saving.” Journal of Economic Perspectives 10, no. 4 (1996): 113–38.

Gelber, A. “ How Do 401(k)s Affect Saving? Evidence from Changes in 401(k) Eligibility.” American Economic Journal: Economic Policy 3, no. 4 (2011): 103–22.

Heim, B., and I. Lurie. “ The Effect of Recent Tax Changes on Tax-Preferred Saving Behavior.” National Tax Journal 65, no. 2 (2012): 283–312.

Madrian, B., and D. Shea. “ The Power of Suggestion: Inertia in 401(k) Participation and Saving Behavior.” Quarterly Journal of Economics 116, no. 4 (2001): 1149–87.

Milligan, K. “ How Do Contribution Limits Affect Contributions to Tax-Preferred Saving Accounts?Journal of Public Economics 87, no. 2 (2003): 253–82.

Poterba, J., S. Venti, et al. “ Do 401(k) Contributions Crowd Out Other Personal Saving?Journal of Public Economics 58, no. 1 (1995): 1–32.

———. “ How Retirement Saving Programs Increase Saving.” Journal of Economic Perspectives 10, no. 4 (1996): 91–112.

Selin, H. “ Marginal Tax Rates and the Tax-Favoured Pension Savings of the Self-Employed: Evidence from Sweden.” Scandinavian Journal of Economics 114, no. 1 (2012): 79–100.

Taxation and Firm Behavior
12 Taxation of Corporate Capital: Investment Incentives

Auerbach, A. “ Taxation, Corporate Financial Policy, and the Cost of Capital.” Journal of Economic Literature 21, no. 3 (1983): 905–40.

———. “ The Tax Reform Act of 1986 and the Cost of Capital.” Journal of Economic Perspectives 1, no. 1 (1987): 73–86.

Auerbach, A., M. Devereux, and H. Simpson. “Taxing Corporate Income.” In Dimensions of Tax Design: The Mirrlees Review. Edited by Institute for Fiscal Studies. Oxford University Press, 2010. ISBN: 9780199553754.

Bernanke, B., H. Bohn, et al. “ Alternative Non-nested Specification Tests of Time Series Investment Models.” Journal of Econometrics 37, no. 3 (1988): 293–326.

Blundell, R., et al. “ Investment and Tobin’s Q: Evidence from Company Panel Data.” Journal of Econometrics 51, no. 1–2 (1992): 233–58.

Cummins, J., K. Hassett, et al. “ Investment Behavior, Observable Expectations, and Internal Funds.” American Economic Review 96, no. 3 (2006): 796–810.

Desai, M., and A. Goolsbee. “ Investment, Overhang, and Tax Policy.” Brookings Papers on Economic Activity, no. 2 (2004): 285–338.

Erickson, T., and T. Whited. “ Measurement Error and the Relationship Between Investment and q.” Journal of Political Economy 108 (2000): 1027–57.

Fazzari, S., R. Hubbard, et al. “ Financing Constraints and Corporate Investment.” Brookings Papers on Economic Activity 19, no. 1 (1988): 141–95.

Goolsbee, A. “Investment Incentives and the After-Tax Price of Capital Goods.” Quarterly Journal of Economics 113 (1998): 121–48.

Hassett, K., and R. G. Hubbard. “Tax Policy and Business Investment.” In Handbook of Public Economics. Vol 3. Edited by A. Auerbach, and M. Feldstein. North Holland, 2002, pp. 1294–343. ISBN: 9780444823144.

House, C., and M. Shapiro. “ Temporary Investment Tax Incentives: Theory with Evidence from Bonus Depreciation.” American Economic Review 98, no. 3 (2008): 737–68.

Knittel, M. “Corporate Response to Accelerated Tax Depreciation: Bonus Depreciation for Tax Years 2002-2004.” (PDF) U.S. Treasury Office of Tax Analysis Working Paper 98, May 2007.

Lamont, O. “ Cash Flow and Investment: Evidence from Internal Capital Markets.” Journal of Finance 52, no. 1 (1997): 83–109.

Shaviro, D. Decoding the U.S. Corporate Income Tax. Urban Institute, 2009. ISBN: 9780877667575. [Preview with Google Books]

Summers, L. “ Taxation and Corporate Investment: A q-Theory Approach.” Brookings Papers on Economic Activity 12, no. 1 (1981): 67–127.

Chen, Y., Z. He, et al. “ The Effect of Investment Tax Incentives: Evidence from China’s Value Added Tax Reform.” mimeo, Tsinghua University, 2011.

13 Taxation and Financial Policy: Debt vs. Equity

Fama, E., and K. French. “ Financing Decisions: Who Issues Stock?Journal of Financial Economics 76 (2005): 549–82.

Givoly, D., et al. “ Taxes & Capital Structure: Evidence from Firms’ Responses to the Tax Reform Act of 1986.” Review of Financial Studies 5 (1992): 331–55.

Graham, J. “ A Review of Taxes and Corporate Finance.” Foundations and Trends in Finance 1, no. 7 (2006): 573–691.

———. “ How Big Are the Tax Benefits of Debt?Journal of Finance 55, no. 5 (2000): 1901–41.

Mackie-Mason, J. “ Do Taxes Affect Corporate Financing Decisions.” Journal of Finance 45, no. 5 (1990): 1471–94.

Miller, M. “ Debt and Taxes.” Journal of Finance 32, no. 2 (1977): 261–75.

Myers, S. “Financing of Corporations.” In Handbook of the Economics of Finance. Vol 1. Edited by A. G. Constantinides, M. Harris, and R. Stulz. North Holland, 2003, pp. 215–53. ISBN: 9780444502988.

Binsbergen, J. van, J. Graham, et al. “ The Cost of Debt.” NBER Working Paper, no. 16023, December 2010.

14 Taxation and Financial Policy: Payout Policy

Allen, F., and R. Michaely. “Payout Policy.” In Handbook of the Economics of Finance. Vol 1A. Edited by G. Constantinides, M. Harris, and R. Stulz. North Holland, 2003, pp. 337–429. ISBN: 9780444513625.

Auerbach, A. “Taxation and Corporate Financial Policy.” In Handbook of Public Economics. Vol 3. Edited by A. Auerbach and M. Feldstein. North Holland, 2002, pp. 1252–92. ISBN: 9780444823144.

Auerbach, A., and K. Hassett. “ On the Marginal Source of Investment Funds.” Journal of Public Economics 87, no. 1 (2003): 205–32.

———. “ The 2003 Dividend Tax Cuts and the Value of the Firm: An Event Study.” In Taxing Capital Income in the 21st Century. Edited by A. Auerbach, J. Hines, and J. Slemrod. Cambridge University Press, 2007, 93–126. ISBN: 9780521870221.

Bagwell, L., and J. Shoven. “ Cash Distributions to Shareholders.” Journal of Economic Perspectives 3, no. 3 (1989): 129–40.

Baker, M., and S. Nagel, et al. “ The Effect of Dividends on Consumption.” Brookings Papers on Economic Activity, no. 1 (2007).

Bernheim, D. “Tax Policy and the Dividend Puzzle.” (PDF - 2.5MB) RAND Journal of Economics 22, no. 4 (1991): 455–76.

Bernheim, D., and A. Wantz. “ A Tax-Based Test of the Dividend Signalling Hypothesis.” American Economic Review 85, no. 3 (1995): 532–51.

Brav, A., J. Graham, et al. “ The Effect of the May 2003 Dividend Tax Cut on Corporate Dividend Policy: Empirical and Survey Evdience.” National Tax Journal 61, no. 3 (2008): 381–96.

Brown, J., N. Liang, et al. “ Executive Financial Incentives and Payout Policy: Firm Responses to the 2003 Dividend Tax Cut.” Journal of Finance 62, no. 4 (2007): 1935–65.

Chetty, R., and E. Saez. “ Dividend Taxes and Corporate Behavior: Evidence from the 2003 Dividend Tax Cut.” Quarterly Journal of Economics 120, no. 3 (2005): 791–834.

———. “ Dividends and Corporate Taxation in an Agency Model of the Firm.” American Economic Journal: Economic Policy 2, no. 3 (2010): 1–31.

DeAngelo, H., L. DeAngelo, et al. “ Dividend Policy and the Earned/Contributed Capital Mix: A Test of Lifecycle Theory.” Journal of Financial Economics 81, no. 2 (2006): 227–54.

Desai, M., and L. Jin. “ Institutional Tax Clienteles and Payout Policy.” Journal of Financial Economics 100, no. 1 (2011): 68–84.

Gordon, R., and M. Dietz. “Dividends and Taxes.” In Institutional Foundations of Public Finance: Economic and Legal Perspectives. Edited by A. Auerbach, and D. Shaviro. Harvard University Press, 2009. ISBN: 9780674030978. [Preview with Google Books]

Korinek, A., and J. Stiglitz. “ Dividend Taxation and Intertemporal Arbitrage.” Journal of Public Economics 93, no. 1–2 (2009): 142–59.

Poterba, J. “ Taxation and Corporate Payout Policy.” American Economic Review 94, no. 2 (2004): 171–5.

Poterba, J., and L. Summers. “The Economic Effects of Dividend Taxation.” In Recent Advances in Corporation Finance. Edited by E. Altman, and M. Subrahmanyam. Richard D Irwin, 1985, pp. 227–84. ISBN: 9780256032796.

PART II
Optimal Commodity Taxation
15 Optimal Commodity Taxes: Ramsey and Beyond

Asano, S., and T. Fukushima. “ Some Empirical Evidence on Demand System and Optimal Commodity Taxation.” Japanese Economic Review 57, no. 1 (2006): 50–68.

Auerbach, A. “ The Theory of Excess Burden and Optimal Taxation.” In Handbook of Public Economics. Vol 1. Edited by M. Feldstein, and A. Auerbach. North Holland, 1985, pp. 61–125. ISBN: 9780444548931.

Auerbach, A., and J. Hines. “ Taxation and Economic Efficiency.” In Handbook of Public Economics. Vol 3. Edited by A. Auerbach and M. Feldstein. North Holland, 2002, pp. 1348–421. ISBN: 9780444823144.

Chari, V. V., and P. Kehoe. “ Optimal Fiscal and Monetary Policy.” Section 1 in Handbook of Macroeconomics. Edited by J. Taylor, and M. Woodford. North Holland, 1999. ISBN: 9780444501561. [Preview with Google Books]

Deaton, A. “Econometric Issues in Tax Design for Developing Countries.” (PDF) In The Theory of Taxation in Developing Countries. Edited by D. Newbery, and N. Stern. Oxford University Press, 1987, pp. 92–113. ISBN: 9780195205411.

Deaton, A., and N. Stern. “ Optimally Uniform Commodity Taxes, Taste Differences, and Lump Sum Grants.” Economics Letters 20, no. 3 (1986): 263–6.

Diamond, P. “ A Many-Person Ramsey Tax Rule.” Journal of Public Economics 4, no. 4 (1975): 335–42.

Diamond, P., and J. Mirrlees. “Optimal Taxation and Public Production I: Production Efficiency” (PDF - 2.9MB), and “Optimal Taxation and Public Production II: Tax Rules.” (PDF) American Economic Review 61, no. 1 (1971): 8–27, and 261–78.

Dixit, A. “ Welfare Effects of Tax and Price Changes.” Journal of Public Economics 4, no. 2 (1975): 103–23.

Kaplow, L. “ On the Undesirability of Commodity Taxation Even When Income Taxation is not Optimal.” Journal of Public Economics 90, no. 6–7 (2006): 1235–50.

Laroque, G. “ Indirect Taxation is Superfluous Under Separability and Taste Homogeneity: A Simple Proof.” Economics Letters 87, no. 1 (2005): 141–4.

Mankiw, N., M. Weinzierl, et al. “ Optimal Taxation in Theory and Practice.” Journal of Economic Perspectives 23, no. 4 (2009): 147–74.

Myles, G. Chapter 4 in Public Economics. Cambridge University Press, 1985. ISBN: 9780521497695. [Preview with Google Books]

Naito, H. “ Re-Examination of Uniform Commodity Taxes Under a Non-Linear Income Tax System and Its Implication for Production Efficiency.” Journal of Public Economics 71, no. 2 (1999): 165–88.

Stern, N. “The Theory of Optimal Commodity and Income Taxation: An Introduction.” In The Theory of Taxation in Developing Countries. Edited by D. Newbery, and N. Stern. Oxford University Press, 1987, pp. 22–59. ISBN: 9780195205411.

Saez, E. “ The Desirability of Commodity Taxation Under Non-Linear Income Taxation and Heterogeneous Tastes.” Journal of Public Economics 83, no. 2 (2002): 217–30.

Slemrod, J. “ Optimal Taxation and Optimal Tax Systems.” Journal of Economic Perspectives 4, no. 1 (1990): 157–78.

16 Optimal Corrective Taxation

Barthold, T. “ Issues in the Design of Environmental Excise Taxes.” Journal of Economic Perspectives 8, no. 1 (1994): 133–52.

Bernheim, B., and A. Rangel. “Behavioral Public Economics: Welfare and Policy Analysis with Non-Standard Decision Makers.” (PDF) In Economic Institutions & Behavioral Economics. Edited by P. Diamond, and H. Vartiainen. Princeton University Press, 2007, pp. 7–77.

Bovenberg, L., and L. Goulder. “Environmental Taxation and Regulation.” In Handbook of Public Economics. Vol 3. Edited by A. Auerbach, and M. Feldstein. North Holland, 2002, pp. 1474–545. ISBN: 9780444823144.

Diamond, P. “ Consumption Externalities and Imperfect Corrective Pricing.” Bell Journal of Economics 4, no. 2 (1973): 526–38.

Goulder, L. “ Environmental Taxation and the Double Dividend: A Reader’s Guide.” International Tax and Public Finance 2, no. 2 (1995): 157–83.

Gruber, J., and B. Koszegi. “ Tax Incidence when Individuals are Time Inconsistent: The Case of Cigarette Excise Taxes.” Journal of Public Economics 88, no. 9–10 (2004): 1959–88.

Metcalf, G. “ Designing a Carbon Tax to Reduce U.S. Greenhouse Gas Emissions.” Review of Environmental Economics and Policy 3, no. 1 (2009): 63–83.

Nordhaus, W. “ To Tax or Not to Tax? Alterative Approaches to Slowing Global Warming.” Review of Environmental Economics and Policy 1, no. 1 (2007): 26–44.

———. “ The “Stern Review” on the Economics of Climate Change.” Journal of Economic Literature 45 (2007): 686–702.

Parry, I., H. Sigman, et al. “The Incidence of Pollution Control Policies.” (PDF) In The International Yearbook of Environmental and Resource Economics 1999/2000: A Survey of Current Issues. Edited by T. Tietenberg, and H. Folmer. Edward Elgar Publishing, 2000, pp. 1–42. ISBN: 9781840641318.

Rothschild, C., and F. Scheuer. “Optimal Taxation with Rent-Seeking.” (PDF) mimeo, Stanford, 2012.

Sinn, H. -W. “ Public Policies against Global Warming: A Supply Side Approach.” International Tax and Public Finance 15, no. 4 (2008): 360–94.

17 Optimal Dynamic Taxes: Intertemporal Ramsey Problem

Barro, R. “On the Determination of Public Debt.” (PDF - 2.7MB) Journal of Political Economy 87, no. 5 (1979): 940–71

Aiyagari, R. A. Marcet, et al. “ Optimal Taxation without State-Contingent Debt.” Journal of Political Economy 110, no. 6 (2002): 1220–54.

Christiano, L., V. V. Chari, et al. “ Optimal Fiscal Policy in a Business Cycle Model.” Journal of Political Economy 102, no. 4 (1994): 617–52.

Fahri, E. “Capital Taxation and Ownership when Markets are Incomplete.” (PDF) mimeo, Harvard, 2006.

Lucas, R., and N. Stokey. “ Optimal Fiscal and Monetary Policy in an Economy without Capital.” Journal of Monetary Economics 12, no. 1 (1983): 55–93.

Werning, I. “ Optimal Fiscal Policy with Redistribution.” Quarterly Journal of Economics 122, no. 3 (2007): 925–68.

18 Taxation of Labor Income—Theory

Akerlof, G. “The Economics of Tagging as Applied to the Optimal Income Tax.” (PDF - 1.3MB) American Economic Review 68, no. 1 (1978): 8–19.

Allen, F. “ Optimal Linear Income Taxation with General Equilibrium Effects on Wages.” Journal of Public Economics 17, no. 2 (1982): 135–44.

Besley, T., and S. Coate. “ Workfare versus Welfare: Incentives Arguments for Work Requirements in Poverty-Alleviation Programs.” American Economic Review 82, no. 1 (1992): 249–61.

Brewer, M., E. Saez, and A. Shephard. “Means Testing and Tax Rates on Earnings.” (PDF - 1.1MB) In Dimensions of Tax Design: The Mirrlees Review. Edited by Institute for Fiscal Studies. Oxford University Press, 2009. ISBN: 9780199553754.

Choné, P., and G. Laroque. “ Optimal Incentives for Labor Force Participation.” Journal of Public Economics 89, no. 2–3 (2005): 395–425.

———. “Should Low Skilled Work be Subsidized?” (PDF) INSEE Working Paper, 2006–08.

———. “Optimal Taxation in the Extensive Model.” (PDF) IFS Working Papers W08/08, Institute for Fiscal Studies.

Diamond, P. “ Income Taxation with Fixed Hours of Work.” Journal of Public Economics 13, no. 1 (1980): 101–10.

———. “Optimal Income Taxation: An Example with a U-Shaped Pattern of Optimal Marginal Tax Rates.” (PDF - 1.8MB) American Economic Review 88, no. 1 (1998): 83–95.

Gaube, T. “ Optimal Taxation of Each Year’s Income.” Journal of Public Economic Theory 9, no. 1 (2007): 127–50.

Helpman, E., and E. Sadka. “ The Optimal Income Tax: Some comparative statics results.” Journal of Public Economics 9, no. 3 (1978): 383–93.

Immonen, R., R. Kanbur, et al. “ Tagging and Taxing: The Optimal Use of Categorical and Income Information in Designing Tax/Transfer Schemes.” Economica 65 (1998): 179–92.

Judd, K., and C. Su. “Optimal Income Taxation with Multidimensional Taxpayer Types.” (PDF) mimeo, University of Chicago, 2006.

Maskin, E., and J. Riley. “ Input versus Output Incentive Schemes.” Journal of Public Economics 28, no. 1 (1985): 1–24.

Kleven, H., C. Kreiner, et al. “ The Optimal Income Taxation of Couples.” Econometrica 77, no. 2 (2009): 537–60.

Mankiw, N., and M. Weinzierl. “ The Optimal Taxation of Height: A Case Study of Utilitarian Income Redistribution.” American Economic Journal: Economic Policy 2, no. 1 (2010): 155–76.

Mirrlees, J. “ An Exploration in the Theory of Optimal Income Taxation.” Review of Economic Studies 38, no. 2 (1971): 175–208.

Piketty, T., and E. Saez. “Income Inequality in the United States, 1913–1998.” (PDF) Quarterly Journal of Economics 118 (2003): 1–39.

Saez, E. “ Using Elasticities to Derive Optimal Income Tax Rates.” Review of Economic Studies 68, no. 1 (2001): 205–29.

———. “ Optimal Income Transfer Programs: Intensive vs. Extensive Labor Supply Responses.” Quarterly Journal of Economics 117, no. 3 (2002): 1039–73.

Slemrod, J., S. Yitzhaki, et al. “ The Optimal Two Bracket Linear Income Tax.” Journal of Public Economics 53, no. 2 (1994): 269–90.

Stern, N. “ Optimum Taxes with Errors in Administration.” Journal of Public Economics 17, no. 2 (1982): 181–211.

———. “ On the Specification of Models of Optimum Income Taxation.” Journal of Public Economics 6, no. 1–2 (1976): 123–62.

Stiglitz, J. “ Pareto Efficient and Optimal Taxation and the New New Welfare Economics.” In Handbook of Public Economics. Vol 2. Edited by A. Auerbach, and M. Feldstein. North-Holland, 1990, pp. 991–1041. ISBN: 9780444879080.

Werning, I. “Pareto Efficient Income Taxation.” (PDF) MIT mimeo.

19 The Taxation of Capital Income and New Dynamic Public Finance

Abel, A. “ Optimal Taxation When Consumers Have Endogenous Benchmark Levels of Consumption.” Review of Economic Studies 72, no. 1 (2005): 21–42.

Aiyagari, S. “ Optimal Capital Income Taxation with Incomplete Markets, Borrowing Constraints, and Constant Discounting.” Journal of Political Economy 103, no. 6 (1995): 1158–75.

Atkeson, A., V. Chari, et al. “ Taxing Capital Income: A Bad Idea.” Federal Reserve Bank of Minneapolis Quarterly Review 23 (1999): 3–18.b

Atkinson, A., and A. Sandmo. “ Welfare Implications of the Taxation of Savings.” Economic Journal 90, no. 359 (1980): 529–49.

Atkinson, A., and J. Stiglitz. Chapter 8 in Lectures on Public Economics. McGraw Hill College, 1980. ISBN: 9780070841055.

Banks, J., and P. Diamond. “The Base for Direct Taxation.” (PDF) In Dimensions of Tax Design: The Mirrlees Review. Edited by Institute for Fiscal Studies. Oxford University Press, 2009. ISBN: 9780199553754.

Bernheim, D. “ Taxation and Saving.” Chapter 18 in Handbook of Public Economics. Vol 3. Edited by A. Auerbach, and M. Feldstein. North Holland, 2002. ISBN: 9780444823144.

Benigno, P., and M. Woodford. “ Optimal Taxation in an RBC Model: A Linear Quadratic Approach.” Journal of Economic Dynamics and Control 30 (2006): 1445–89.

Chamley, C. “ Efficient Tax Reform in a Dynamic Model of General Equilibrium.” Quarterly Journal of Economics 100, no. 2 (1985): 335–56.

———. “ Optimal Taxation of Capital Income in General Equilibrium with Infinite Lives.” Econometrica 54, no. 3 (1986): 607–22

Conesa, J., S. Kitao, et al. “ Taxing Capital? Not a Bad Idea After All.” American Economic Review 99, no. 1 (2009): 25–48.

Diamond, P., and J. Spinnewijn. “Capital Income Taxes with Heterogeneous Discount Rates.” (PDF) NBER Working Paper, no. 15115, 2009.

Diamond, P. “ The Incidence of an Interest Income Tax.” Journal of Economic Theory 2, no. 3 (1970): 211–24.

Farhi, E., and I. Werning. “ Capital Taxation: Quantitative Explorations of the Inverse Euler Equation.” Journal of Political Economy 120, no. 3 (2012).

Farhi, E., C. Sleet, et al. “ Non-linear Capital Taxation Without Commitment.” Review of Economic Studies 79, no. 4 (2012): 1469–93.

Golosov, M., N. Kocherlakota, et al. “ Optimal Indirect and Capital Taxation.” Review of Economic Studies 70, no. 3 (2003): 569–88.

Golosov, M., and A. Tsyvinski. “ Optimal Taxation with Endogenous Insurance Markets.” Quarterly Journal of Economics 122 (2007): 487–534.

Buy at MIT Press Golosov, M., A. Tsyvinski, and I. Werning. “New Dynamic Public Finance: A User’s Guide.” (PDF) In NBER Macroeconomics Annual 2006. Edited by D. Acemoglu, K. Rogoff, and M. Woodford. MIT Press, 2007, pp. 317–63. ISBN: 9780262512008.

Feldstein, M. “ The Welfare Cost of Capital Income Taxation.” Journal of Political Economy 86, no. 2 (1978): S29–52.

Judd, K. “Optimal Taxation in Dynamic Stochastic Economies: Theory and Evidence.” mimeo, Hoover Institution, 1989.

———. “ The Welfare Cost of Factor Taxation in a Perfect Foresight Model.” Journal of Political Economy 95, no. 4 (1987): 675–709.

———. “ Redistributive Taxation in a Simple Perfect Foresight Model.” Journal of Public Economics 28, no. 1 (1985): 59–83.

———. “ Optimal Taxation and Spending in General Competitive Growth Models.” Journal of Public Economics 71, no. 1 (1999): 1–26.

Kocherlakota, N. “ Zero Expected Wealth Taxes: A Mirrlees Approach to Dynamic Optimal Taxation.” Econometrica 73, no. 5 (2005): 1587–622.

———. “Advances in Dynamic Optimal Taxation.” (PDF) In Advances in Economics and Econometrics: Theory and Applications, Ninth World Congress. Edited by R. Blundell, W. Newey, and T. Persson. Cambridge University Press, 2006, pp. 269–97. ISBN: 9780521692083.

———. The New Dynamic Public Finance. Princeton University Press, 2010. ISBN: 9780691139159. [Preview with Google Books]

Lucas, R. “ Supply-Side Economics: An Analytical Review.” Oxford Economic Papers 42, no. 2 (1990): 293–316.

Saez, E. “ Optimal Progressive Capital Income Taxation in the Infinite Horizon Model.” NBER Working Paper, no. 9046, July 2002.

Stokey, N., and S. Rebelo. “ Growth Effects of Flat-Rate Taxes.” Journal of Political Economy 103, no. 3 (1995): 519–50.

Werning, I. “Nonlinear Capital Taxation.” (PDF) working paper, MIT, September 2011.

20 Dynamic Taxation of Labor Income and Insurance

Albanesi, S., and C. Sleet. “ Dynamic Optimal Taxation with Private Information.” Review of Economic Studies 73, no. 1 (2006): 1–30.

Erosa, A., and M. Gervais. “ Optimal Taxation in Life-Cycle Economies.” Journal of Economic Theory 105, no. 2 (2002): 338–69.

Farhi, E., and I. Werning. “Insurance and Taxation over the Life Cycle.” (PDF) forthcoming Review of Economic Studies (2012).

21 Taxation of Intergenerational Transfers (Estate Taxation)

Aaron, H., and A. Munnell. “ Reassessing the Role for Wealth Transfer Taxes.” National Tax Journal 45, no. 2 (1992): 119–44.

Bernheim, B., R. Lemke, et al. “ Do Estate and Gift Taxes Affect the Timing of Private Transfers.” Journal of Public Economics 88, no. 12 (2004): 2617–34.

Farhi, E., and I. Werning. “ Progressive Estate Taxation.” Quarterly Journal of Economics 125, no. 2 (2009): 635-73.

Gale, W., and J. Slemrod. “Overview.” (PDF) In Rethinking Estate and Gift Taxation: Overview. Edited by W. Gale, J. Hines, and J. Slemrod. Brookings Institution, 2001, pp. 1–64.

Kopczuk, W. “Economics of estate taxation: a brief review of theory and evidence.” (PDF) NBER Working Paper, no. 15741.

Piketty, T., and E. Saez. “A Theory of Optimal Capital Taxation.” (PDF) NBER Working Paper, no. 17989, April 2012.

———. “ The Evolution of Top Incomes: A Historical and International Perspective.” American Economic Review, Papers and Proceedings 96, no. 2 (2006): 200–5. (NBER Working Paper No. 11955 version)

Poterba, J. “ The Estate and Gift Tax and Inter Vivos Giving in the United States.” Journal of Public Economics 79, no. 1 (2001): 237–64.

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