Does altruism affect the optimal fiscal policy?
- Autores: Carlos Garriga, Fernando Sánchez
- Localización: IX encuentro de economía pública, hacienda y medio ambiente: [Vigo]. 7 y 8 de febrero de 2002, 2002
- Idioma: inglés
- Enlaces
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Resumen
This paper explores the optimal �scal policy in economies with altruism.
We characterize the optimal taxes in the transition path and in the steady state. We show that the �rst best policy can be attained independently of the altruism type if the government disposes of a complete set of �scal instruments (public debt and proportional taxes on consumption, capital, labor and bequests), being the consumption tax not redundant. If the government can not use the consumption tax, then the way of how altruism exactly operates is decisive in setting optimal taxes. When dynastic altruism characterizes the economy, the optimal capital tax becomes zero in steady state if and only if the optimal bequest tax is zero. When joy-of-giving is the altruism motive, the optimal capital tax does not converge to zero and this happens independently of the bequest tax.
