Estimados Académicos y Académicas FEN,

Les extendemos la invitación al seminario organizado por el Departamento de Economía, en el que se presentará el trabajo titulado "Larger Transfers Financed with More Prograssive Taxes? On the Optimal Design of Taxes and Transfers".

Presenta: Axelle Ferriere, Asssistant Professor of Economics, PSE; Research Fellow, CNRS.

Coaturoes: Philipp Grübener, Gaston Navarro y Oliko Vardishvili.

Abstract: The U.S. fiscal system redistributes through a rich set of taxes and transfers, the latter accounting for a large part of the income of the poor. Motivated by this, we study the optimal joint design of transfers and income taxes. Within a simple heterogeneous-household framework, we derive two analytical results. First, higher transfers reduce the optimal income tax progressivity. Second, optimal transfers are positive. Redistribution is achieved with generous transfers while efficiency is preserved via a lower progressivity of income taxes. As such, the optimal tax-and-transfer system features larger progressivity of average than of marginal tax rates. We then quantify the optimal tax-and-transfer system in a rich incomplete-market model with realistic distributions of income, wealth, and income risk. The model features a novel flexible functional form for progressive income taxes and means-tested transfers. Relative to the current U.S. fiscal system, the optimal policy consists of more generous means-tested transfers, which phase-out at a slower rate, together with less progressive income taxes.

Link al evento.

Saludos cordiales, 

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