Capital Taxation in the Twenty-First Century
American Economic Review
vol. 105,
no. 5, May 2015
(pp. 38-42)
Abstract
In his influential book, Capital in the Twenty-First Century, Thomas Piketty argues forcefully that rising wealth and wealth inequality is an inherent characteristic of capitalist economies and calls for strong policy responses, in particular a substantial wealth tax implemented globally. This paper takes issue with the facts, logic, and policy conclusions in Piketty's book, suggesting that the factors needed to support the inexorable rise in capital's share and concentration are lacking and that among tax policy reforms aimed at dealing with economic inequality a wealth tax finds little support either in Piketty's own work or elsewhere in the literature.Citation
Auerbach, Alan J., and Kevin Hassett. 2015. "Capital Taxation in the Twenty-First Century." American Economic Review, 105 (5): 38-42. DOI: 10.1257/aer.p20151058Additional Materials
JEL Classification
- D31 Personal Income, Wealth, and Their Distributions
- E22 Investment; Capital; Intangible Capital; Capacity
- E23 Macroeconomics: Production
- E25 Aggregate Factor Income Distribution
- H24 Personal Income and Other Nonbusiness Taxes and Subsidies; includes inheritance and gift taxes
- H87 International Fiscal Issues; International Public Goods
- P16 Capitalist Systems: Political Economy