All Rights Reserved
AccessEcon LLC 2006, 2008.
Powered by MinhViet JSC

Ramon J. Torregrosa-Montaner
''Lump-sum over Distortionary Taxation Dominance with Heterogeneous Individuals''
( 2015, Vol. 35 No.3 )
The dominance of lump-sum over distortionary taxation for the single consumer case is a well-known proposition in microeconomics. This result implies that if the consumer is asked about what tax she would pay to bear a given tax burden, she would choose lump-sum taxation. This paper provides a version of this dominance of lump-sum taxation for the case of several heterogeneous individuals by means of a game where the government allows each individual to choose between the two tax regimes.
Keywords: Lump-sum taxation, distortionary taxation, pure strategy Nash equilibrium.
JEL: H3 - Fiscal Policies and Behavior of Economic Agents: General
Manuscript Received : Jun 10 2015 Manuscript Accepted : Jul 11 2015

  This abstract has been downloaded 1384 times                The Full PDF of this paper has been downloaded 153793 times