Estate Taxation with Altruism Heterogeneity
We develop a theory of optimal estate taxation in a model where bequest inequality is driven by differences in parental altruism. We show that a wide range of results are possible, from positive taxes to subsidies, depending on redistributive objectives implicit in the cardinal specification of utility and social welfare functions. We propose a normalization that is helpful in classifying these different possibilities. We isolate cases where the optimal policy bans negative bequests and taxes positive bequests, features present in most advanced countries.
Document Object Identifier (DOI): 10.3386/w18792
Published: Emmanuel Farhi & IvÃ¡n Werning, 2013. "Estate Taxation with Altruism Heterogeneity," American Economic Review, American Economic Association, vol. 103(3), pages 489-95, May. citation courtesy of
Users who downloaded this paper also downloaded* these: