NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Spreading the Wealth Around: Reflections Inspired by Joe the Plumber

N. Gregory Mankiw

NBER Working Paper No. 15846
Issued in March 2010
NBER Program(s):   PE

This essay discusses the policy debate concerning optimal taxation and the distribution of income. It begins with a brief overview of trends in income inequality, the leading hypothesis to explain these trends, and the distribution of the tax burden. It then considers the framework that economists use to address the normative problem of designing tax systems. The conventional utilitarian approach is found to be wanting, as it leads to prescriptions that conflict with many individuals’ moral intuitions. The essay then explores an alternative normative framework, dubbed the Just Deserts Theory, according to which an individual’s compensation should reflect his or her social contribution.

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Document Object Identifier (DOI): 10.3386/w15846

Published: N Gregory Mankiw, 2010. "Spreading the Wealth Around: Reflections Inspired by Joe the Plumber," Eastern Economic Journal, Palgrave Macmillan Journals, vol. 36(3), pages 285-298.

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