Education and optimal dynamic taxation. The role of income-contingent student loans. This version: September 20, 2012.

Autor/inn/en	Findeisen, Sebastian; Sachs, Dominik
Titel	Education and optimal dynamic taxation. The role of income-contingent student loans. This version: September 20, 2012.
Quelle	Zurich: Univ., Dep. of Economics (2012), 53 S. PDF als Volltext kostenfreie Datei (1); PDF als Volltext kostenfreie Datei (2) Link als defekt meldenVerfügbarkeit
Reihe	Working paper series / University of Zurich, Department of Economics. 40
Beigaben	grafische Darstellungen
Sprache	englisch
Dokumenttyp	online; Monographie; Graue Literatur
DOI	10.5167/uzh-51544
Schlagwörter	Bildungsverhalten; Bildungsertrag; Gleichgewicht; Einkommensteuer; Steuer; Erwerbsverlauf; Arbeitspapier; USA
Abstract	We study Pareto optimal tax and education policies when human capital upon labor market entry is endogenous and individuals face wage uncertainty. Though optimal labor distortions are history-dependent, i.e. depend on income and education, simple policy instruments can yield the desired distortions: a single nonlinear labor income tax schedule combinedwith income-contingent loans. To take themodel to the (US) data, we simplify the model to a binary education decision (graduating from college or not). We find that for lowand intermediate incomes the labor supply decision of college graduates should be distorted more heavily than for individuals without a college degree. As a consequence, the optimal student loan repayment schedule increases in income for this range. This result holds along the Pareto frontier. We compare the second best to a situation where loan repayment is restricted to be independent from income and find significant welfare gains.
Erfasst von	ZBW - Leibniz-Informationszentrum Wirtschaft, Kiel
Update	2013/4