Ramsey's principle of optimal taxation: Difference between revisions
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'''Ramsey's principle of optimal taxation''' states that the optimal tax rate on an activity should be inversely proportional to the price-elasticity of that activity (this is obtained by summing up the price-elasticity of demand and the price-elasticity of supply). | '''Ramsey's principle of optimal taxation''' states that the optimal tax rate on an activity should be inversely proportional to the price-elasticity of that activity (this is obtained by summing up the price-elasticity of demand and the price-elasticity of supply). | ||
==See also== | |||
* [[Laffer curve]] | |||
==External links== | ==External links== | ||
* [http://scholar.harvard.edu/mankiw/files/optimal_taxation_in_theory.pdf Optimal Taxation in Theory and Practice] by N. Gregory Mankiw, Matthew Weinzierl, and Danny Yagan | * [http://scholar.harvard.edu/mankiw/files/optimal_taxation_in_theory.pdf Optimal Taxation in Theory and Practice] by N. Gregory Mankiw, Matthew Weinzierl, and Danny Yagan | ||
Latest revision as of 23:50, 22 June 2014
Ramsey's principle of optimal taxation states that the optimal tax rate on an activity should be inversely proportional to the price-elasticity of that activity (this is obtained by summing up the price-elasticity of demand and the price-elasticity of supply).
See also
External links
- Optimal Taxation in Theory and Practice by N. Gregory Mankiw, Matthew Weinzierl, and Danny Yagan