Dynamics Model of Firms' Income Tax

Kód výsledku v IS VaVaI

<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F62690094%3A18450%2F16%3A50004917" target="_blank" >RIV/62690094:18450/16:50004917 - isvavai.cz</a>

Výsledek na webu

<a href="http://mme2016.tul.cz/conferenceproceedings/mme2016_conference_proceedings.pdf" target="_blank" >http://mme2016.tul.cz/conferenceproceedings/mme2016_conference_proceedings.pdf</a>

DOI - Digital Object Identifier

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Jazyk výsledku

angličtina

Název v původním jazyce

Dynamics Model of Firms' Income Tax

Popis výsledku v původním jazyce

The aim of this paper is to introduce a simple dynamic model that describes the tax revenue of a given government. The paper deals with a modification of Ramsey model that uses the neoclassical dynamical model and determines the optimal consumption as a result of optimal intertemporal choices of individual households. For simplicity the model considers only a tax on income of firms. This leads to a different selecting of optimal prices of labor and capital services. Euler equation of optimal consumption path of household is then introduced as well as its particular interpretation. We also study long-term effects of taxation of the given model. Hence the steady state of the dynamical model is introduced and then a formula for steady state Laffer curve is derived. Having this formula we further study the properties of optimization of tax revenue. First, it is shown that the optimal tax rate is dependent on the magnitude of elasticity of capital which is an exogenous parameter of the neoclassical production function. Then methods of comparative statics are used to find a sensitivity of tax revenue at steady state of the economic unit on some parameters.

Název v anglickém jazyce

Dynamics Model of Firms' Income Tax

Popis výsledku anglicky

The aim of this paper is to introduce a simple dynamic model that describes the tax revenue of a given government. The paper deals with a modification of Ramsey model that uses the neoclassical dynamical model and determines the optimal consumption as a result of optimal intertemporal choices of individual households. For simplicity the model considers only a tax on income of firms. This leads to a different selecting of optimal prices of labor and capital services. Euler equation of optimal consumption path of household is then introduced as well as its particular interpretation. We also study long-term effects of taxation of the given model. Hence the steady state of the dynamical model is introduced and then a formula for steady state Laffer curve is derived. Having this formula we further study the properties of optimization of tax revenue. First, it is shown that the optimal tax rate is dependent on the magnitude of elasticity of capital which is an exogenous parameter of the neoclassical production function. Then methods of comparative statics are used to find a sensitivity of tax revenue at steady state of the economic unit on some parameters.

Druh

D - Stať ve sborníku

CEP obor

BB - Aplikovaná statistika, operační výzkum

OECD FORD obor

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Projekt

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Návaznosti

S - Specificky vyzkum na vysokych skolach

Rok uplatnění

2016

Kód důvěrnosti údajů

S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Název statě ve sborníku

Mathematical methods in economics (MME 2016)

ISBN

978-80-7494-296-9

ISSN

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e-ISSN

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Počet stran výsledku

6

Strana od-do

705-710

Název nakladatele

Technická univerzita v Liberci

Místo vydání

Liberec

Místo konání akce

Liberec

Datum konání akce

6. 9. 2016

Typ akce podle státní příslušnosti

EUR - Evropská akce

Kód UT WoS článku

000385239500121