Taxation and the allocation of talent
Taxation affects the allocation of talented individuals across professions by blunting material incentives and thus magnifying nonpecuniary incentives of pursuing a “calling.” Estimates from the literature suggest that high-paying professions have negative externalities, whereas lowpaying profession...
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| Veröffentlicht in: | Journal of political economy 2017-10, Vol.125 (5), p.1635-1682 |
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| container_end_page | 1682 |
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| container_issue | 5 |
| container_start_page | 1635 |
| container_title | Journal of political economy |
| container_volume | 125 |
| creator | Lockwood, Ben Nathanson, Charles G Weyl, E. Glen |
| description | Taxation affects the allocation of talented individuals across professions by blunting material incentives and thus magnifying nonpecuniary incentives of pursuing a “calling.” Estimates from the literature suggest that high-paying professions have negative externalities, whereas lowpaying professions have positive externalities. A calibrated model therefore prescribes negative marginal tax rates on middle-class incomes and positive rates on the rich. The welfare gains from implementing such a policy are small and are dwarfed by the gains from profession-specific taxes and subsidies. These results depend crucially on externality estimates and labor substitution patterns across professions, both of which are very uncertain given existing empirical evidence. |
| doi_str_mv | 10.1086/693393 |
| format | Article |
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These results depend crucially on externality estimates and labor substitution patterns across professions, both of which are very uncertain given existing empirical evidence.</description><subject>Ability</subject><subject>Allocation</subject><subject>Allokation</subject><subject>Berufswahl</subject><subject>Economic theory</subject><subject>Einkommensteuer</subject><subject>Externality</subject><subject>Incentives</subject><subject>Middle class</subject><subject>Political economy</subject><subject>Professions</subject><subject>Qualifikation</subject><subject>Subsidies</subject><subject>Tax rates</subject><subject>Taxation</subject><subject>Theorie</subject><subject>USA</subject><subject>Wages & salaries</subject><subject>Welfare</subject><issn>0047-2697</issn><issn>1537-534X</issn><issn>0022-3808</issn><issn>1537-534X</issn><fulltext>true</fulltext><rsrctype>article</rsrctype><creationdate>2017</creationdate><recordtype>article</recordtype><sourceid>7TQ</sourceid><recordid>eNqNkEtLxDAQx4MouK76BUQo-MBLNWmapjnK4gsWvKzgrUzzcLvUpiYp6Lc3ElGPzmWYmd_Mf2YQOiT4kuC6uqoEpYJuoRlhlOeMls_baIZxyfOiEnwX7Xm_wdEYYTN0toJ3CJ0dMhhUFtY6g763MqWsyQL0egj7aMdA7_XBt5-jp9ub1eI-Xz7ePSyul7ksWRGilpJVTY0kUEqNOZQtUxBjMKqFQlMVM5wagVVRxY5WtFBzLipQzGiC6RydpLmjs2-T9qHZ2MkNUbIhohakruuCReo8UdJZ7502zei6V3AfDcHN1wua9IIIXiRwkutOwosdnfb-d2bCmlGZiJ7-A43YccI2Plj3o1tUjOF4UKwfpbrqxj9rEVpizOknDjp6Bw</recordid><startdate>20171001</startdate><enddate>20171001</enddate><creator>Lockwood, Ben</creator><creator>Nathanson, Charles G</creator><creator>Weyl, E. 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Glen</au><format>journal</format><genre>article</genre><ristype>JOUR</ristype><atitle>Taxation and the allocation of talent</atitle><jtitle>Journal of political economy</jtitle><date>2017-10-01</date><risdate>2017</risdate><volume>125</volume><issue>5</issue><spage>1635</spage><epage>1682</epage><pages>1635-1682</pages><issn>0047-2697</issn><issn>1537-534X</issn><issn>0022-3808</issn><eissn>1537-534X</eissn><abstract>Taxation affects the allocation of talented individuals across professions by blunting material incentives and thus magnifying nonpecuniary incentives of pursuing a “calling.” Estimates from the literature suggest that high-paying professions have negative externalities, whereas lowpaying professions have positive externalities. A calibrated model therefore prescribes negative marginal tax rates on middle-class incomes and positive rates on the rich. 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| ispartof | Journal of political economy, 2017-10, Vol.125 (5), p.1635-1682 |
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| source | PAIS Index; EBSCOhost Business Source Complete; JSTOR Archive Collection A-Z Listing; University of Chicago Press Journals (Full run); EBSCOhost Political Science Complete |
| subjects | Ability Allocation Allokation Berufswahl Economic theory Einkommensteuer Externality Incentives Middle class Political economy Professions Qualifikation Subsidies Tax rates Taxation Theorie USA Wages & salaries Welfare |
| title | Taxation and the allocation of talent |
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