Working Paper

Marginal tax rates and income inequality: a quantitative-theoretic analysis


Abstract: An Auerbach-Kotlikoff (AK) overlapping-generations model is used to examine how changes in marginal income-tax rate structures affect the distribution of income, drawing on actual changes to the U.S. tax code. This approach builds on AK by allowing for many different cohort types, and hence for a nontrivial endogenous distribution of income.

Keywords: Income distribution; Income tax;

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Bibliographic Information

Provider: Federal Reserve Bank of Cleveland

Part of Series: Working Papers (Old Series)

Publication Date: 1995

Number: 9508