Public Finance, 3rd Edition

Chapter 15

Taxation under Asymmetric Information

Abstract

Chapter 15 explores the implications of asymmetric information on taxation, and later chapters extend the analysis to transfer payments and other public expenditures. Topics include the limitations of lump-sum redistributions under asymmetric information, the limit to redistribution under a sales tax, pareto-efficient taxation under self-selection constraints, optimal income taxation, and tax evasion.

Keywords

Earned Income Tax Credit (EITC); Optimal income taxation; Self-selection (incentive compatibility) constraints; Tax amnesty; Tax avoidance; Tax evasion

Chapter Outline

Lump-sum Redistributions and Private Information 252

Redistribution through Commodity Taxations 253

Optimal Taxation, Private ...