Working Papers,
Lund University, Department of Economics

Abstract: This article analyzes constrained Pareto efficient nonlinear income tax schedules that are monotonic chains to the left. It is demonstrated that as long as all individuals have a positive consumption at the tax schedule that maximizes the utility of the worst-off individual, the constrained utility possibility set is convex. As a consequence, all constrained Pareto efficient nonlinear income tax schedules that are monotonic chains to the left can be identified by maximizing a weighted summation of net utilities.

Keywords: Nonlinear income taxation; Utility possibility set; Convexity

JEL-codes: H21

9 pages, First version: March 4, 2005. Revised: September 28, 2006. Earlier revisions: October 5, 2005.

Download statistics

Published as

Tommy Andersson, (2007), 'A Note on Nonlinear Income Taxes and the Utility Possibility Set', Economics Bulletin, vol 8, no 5, pages 1-8

• Lund University, Department of Economics
• Home page for this series

Questions (including download problems) about the papers in this series should be directed to Iker Arregui Alegria ()
Report other problems with accessing this service to Sune Karlsson ().

RePEc:hhs:lunewp:2005_020This page generated on 2024-09-13 22:16:09.