TY - JOUR
T1 - Uncertain parameter values and the choice among policy options
AU - Fullerton, Don
AU - Lyon, Andrew B.
N1 - Funding Information:
*This paper was written while both authors were at Princeton University. We wish to thank Charles L. Ballard, Yolanda K. Henderson, John B. Shoven, Charles Stuart, and John Whalley for help with this research and for useful suggestions. Financial assistance was provided by the Treasury Department’s Office of Tax Analysis and the National Science Foundation under grant SES 802.5404. The research reported here is part of the NBER’s research program in Taxation and project in Government Budget. Any opinions expressed are those of the authors and not those of the National Bureau of Economic Research, the U.S. Treasury Department, or the Joint Committee on Taxation.
PY - 1986/6
Y1 - 1986/6
N2 - We use a tax policy example to show how debate on the value of an elasticity parameter translates into a debate about policy choices. To construct this example, suppose that the choice among four particular tax reform options is based on a single measure of efficiency gain. For each reform, we show how the size of this gain depends upon the elasticity of saving with respect to the net rate of return. Moreover, within quite narrow and reasonable bounds for the elasticity parameter, we find regions in which each of three different tax reforms turns out to dominate the others.
AB - We use a tax policy example to show how debate on the value of an elasticity parameter translates into a debate about policy choices. To construct this example, suppose that the choice among four particular tax reform options is based on a single measure of efficiency gain. For each reform, we show how the size of this gain depends upon the elasticity of saving with respect to the net rate of return. Moreover, within quite narrow and reasonable bounds for the elasticity parameter, we find regions in which each of three different tax reforms turns out to dominate the others.
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U2 - 10.1016/0047-2727(86)90080-0
DO - 10.1016/0047-2727(86)90080-0
M3 - Article
AN - SCOPUS:45949127859
SN - 0047-2727
VL - 30
SP - 109
EP - 116
JO - Journal of Public Economics
JF - Journal of Public Economics
IS - 1
ER -