Date: 2014
Type: Working Paper
Optimal taxation and debt with uninsurable risks to human capital accumulation
Working Paper, EUI ECO, 2014/08
GOTTARDI, Piero, KAJII, Atsushi, NAKAJIMA, Tomoyuki, Optimal taxation and debt with uninsurable risks to human capital accumulation, EUI ECO, 2014/08 - https://hdl.handle.net/1814/32016
Retrieved from Cadmus, EUI Research Repository
We consider an economy where individuals face uninsurable risks to their human capital
accumulation, and study the problem of determining the optimal level of linear taxes on capital
and labor income together with the optimal path of the debt level. We show both analytically
and numerically that in the presence of such risks it is bene cial to tax both labor and capital
income and to have positive government debt.
Cadmus permanent link: https://hdl.handle.net/1814/32016
ISSN: 1725-6704
Series/Number: EUI ECO; 2014/08
Keyword(s): Ramsey equilibrium Optimal taxation Incomplete markets Optimal public debt D52 D60 D90 E20 E62 H21 O40
Published version: http://hdl.handle.net/1814/38586