Comment

摘要

This interesting and stimulating paper (referred to as GTW) discusses four issues: when capital should not be taxed, when labor taxes should be constant over time and states of nature, the sources of concern about limited government commitment, and the methodology of modeling for tax analysis. And it contains calculated examples. I will touch on three of these issues, leaving out the complex issue of how policy feasibility and desirability are influenced by the nature of the political process in democratic states. In the macro tradition, the analysis focuses on settings with stochastic shocks. To bring a public economics perspective, I will consider the first two issues in deterministic models with heterogeneous populations. Then I will consider a stochastic model to add to the intuition about taxing savings. For clarity of presentation, I work with models with only two types of workers and assume that the binding incentive compatibility constraint is that type-A not imitate type-B. I do not consider sufficient conditions for this pattern of constraints to be correct.