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Kemper W. Moreland
''Income inequality, utility, and optimal income taxation''
( 2019, Vol. 39 No.1 )
Income inequality has increasingly become a concern for politicians, voters, and economists. Lively debates arise on how the tax and welfare system can reduce this income inequality. Economists studying optimal income tax design, however, search for the properties of a tax system that maximizes a social welfare function dependent upon individuals' utilities. This study analyzes policy differences and the social cost resulting from policymakers searching to reduce income inequality rather than utility inequality.
Keywords: income inequality, welfare, optimal income tax
JEL: H2 - Taxation, Subsidies, and Revenue: General
D6 - Welfare Economics: General
Manuscript Received : Sep 24 2018 Manuscript Accepted : Mar 19 2019

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