An Alternative View of Taxation and Endogenous Growth

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dc.contributor.authorHuffman, Gregory W.
dc.date.accessioned2020-09-13T19:45:46Z
dc.date.available2020-09-13T19:45:46Z
dc.date.issued2001
dc.description.abstractIn this paper, a modification is made to the endogenous growth model studied by Lucas [1988]. It is shown that if individuals derive utility from their level of human capital, then a tax on the return to physical capital can raise the equilibrium growth rate. Consumption taxation may increase the growth rate. If there is an externality in production of human capital, then it may be optimal to impose a capital tax, as opposed to a subsidy, to achieve the optimal growth rate. This may be a reason why existing estimates of the welfare costs of capital taxation may be overstated.
dc.description.departmentEconomics
dc.identifier.urihttp://hdl.handle.net/1803/15684
dc.language.isoen_US
dc.publisherVanderbilt Universityen
dc.subject.other
dc.titleAn Alternative View of Taxation and Endogenous Growth
dc.typeWorking Paperen
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