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| Tommy Andersson |
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| ''A Note on Nonlinear Income Taxes and the Utility Possibility Set'' |
| ( 2007, Vol. 8 No.5 ) |
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| This note analyzes constrained Pareto efficient nonlinear income tax schedules that are monotonic chains to the left. The main result demonstrates that if all individuals have a positive consumption at the tax schedule that maximizes the utility of the worst-off individual, then the constrained utility possibility set is convex. As a consequence, all constrained Pareto efficient nonlinear income tax schedules that are monotonic chains to the left can be identified by maximizing a weighted summation of net utilities. |
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| Keywords: |
JEL: H2 - Taxation, Subsidies, and Revenue: General
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| Manuscript Received : Feb 28 2007 | | Manuscript Accepted : May 29 2007 |
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