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Title: |
Differential Saving Rates, Tax Burdens, and
Welfare |
| Author: |
Khang, Chulsoon |
| Author
Affiliation: |
U OR |
| Source: |
International Economic Journal, Summer 1996, v. 10, no. 2, pp. 1-23 |
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Publication Date: |
Summer 1996 |
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Abstract: |
The paper examines the short-run and
long-run consequences of shifting the tax burden from the middle class
to the rich in terms of an extended version of Solow's growth model with
two classes of people separated by differential saving rates. Under
certain circumstances, the middle class tax relief at the expense of the
rich makes everyone worse off in the long run. It is also argued that an
increase in the saving rate of the low saving class is the most
effective means to reduce the income disparity between classes. |
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