It has been shown that a one-sector real business cycle model with sufficient increasing returns in production may possess an indeterminate steady state that can be exploited to generate business cycles.
This paper shows that the optimal steady-state tax on capital income in a neoclassical growth model can be positive, negative, or zero, depending crucially on the level of monopoly profits and the degree to which profits can be taxed.
A demonstration that the assumed structure of taxation can have dramatic effects on economic welfare and on the stability of the steady state in a dynamic general-equilibrium model of optimal fiscal policy.
An analysis of various schemes for simplifying the U.S. tax system, which finds that a uniform tax system performs almost as well as a system with separate taxes on labor and capital incomes, provided that a depreciation allowance is maintained.
