Subjective well-being, consumption comparisons, and optimal income taxation

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Income Taxation and Well-Being

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This paper offers a first empirical investigation of how labor taxation (income and payroll taxes) affects individuals' well-being. For identification, we exploit exogenous variation in tax rules over time and across demographic groups using 26 years of German panel data. We find that the tax effect on subjective well-being is significant and positive when controlling for income net of taxes. T...

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ژورنال

عنوان ژورنال: Journal of Public Economic Theory

سال: 2017

ISSN: 1097-3923

DOI: 10.1111/jpet.12281