Optimal Taxation in Life-Cycle Economies in the Presence of Commitment and Temptation Problems
2013/09/17
研討會日期 : 2013-09-17
時間 : 14:30
主講人 : Professor Cagri S. Kumru
地點 : Conference Room B110
演講者簡介 : Cagri S. Kumru received his Ph.D. in Economics from University of Pittsburgh in 2001. He is currently Lecturer of Research School of Economics at Australian National University. His research fields are macroeconomic theory, public economics, computational economics and behavioral economics.
演講摘要 : Self-control problem is an important determinant of individuals’ economic decisions. The decision maker’s future utility is affected by unwanted temptation. This implies that implications of various government policies would differ if one incorporates these behavioral aspects. Public finance instruments could, however, be used to correct anomalies created by temptation. The purpose of this paper is to examine the question of optimal taxation when individuals have self-control problems. In order to capture individuals’ temptation towards current consumption, our model makes use of the preference structure pioneered by Gul and Pesendorfer and further elaborated by Krusell et al. in the context of optimal taxation. We extend by adding labor choice and besides savings tax, we also compute capital income tax, consumption tax and labor income tax. Results show that in the T period model where the utility function is separable in consumption and labor supply, the government should subsidize either capital income or investment as it maximizes both an individual.s commitment utility for consumption and labor supply at the same time. Because individuals consume and supply labor more than their commitment utility, subsidizing improves welfare as it makes temptation less attractive.
