Seiya, Fujisaki and Kazuo, Mino (2010): Growth and Distributional Effects of Inflation with Progressive Taxation.
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This paper examines the growth and income distribution effects of inflation in a growing economy with heterogeneous households and progressive income taxation. Assuming that the cash-in-advance constraint applies to investment as well as to consumption spending, we show that a higher growth of monetary supply yields a negative impact on growth and an ambiguous effect on income distribution. Numerical example with plausible parameter values, however, demonstrate that those long-run effects of inflation tax are rather small. In contrast, fiscal distortion caused by progressive taxation yield significant impacts on growth and distribution
|Item Type:||MPRA Paper|
|Original Title:||Growth and Distributional Effects of Inflation with Progressive Taxation|
|Keywords:||Inflation Tax, Progressive Income Tax, Growth, Income Distribution|
|Subjects:||E - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles > E32 - Business Fluctuations; Cycles
O - Economic Development, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O40 - General
|Depositing User:||Kazuo Mino|
|Date Deposited:||25. Oct 2010 07:53|
|Last Modified:||15. Feb 2013 23:28|
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