Konrad, Kai A.; Spadaro, Amedeo
Education, redistributive taxation and confidence.
WZB Discussion Paper, SP II 2005-05
Volltext auf 'Open Access LMU' nicht verfügbar.
We consider redistributional taxation between people with and without human
capital if education is endogenous and if individuals differ in their perceptions
about own ability. Those who see their ability as low like redistributive taxation
because of the transfers it generates. Those who see their ability as high may
also like redistributive taxation because it stops other people receiving
education and increases the quasi rents on their own human capital. It is
surprising that this rather indirect effect can overcompensate them for the
income loss from taxation and make the overconfident want higher taxes than
the less confident do. The results, however, turn out to be in line with empirical
evidence on the desired amount of redistribution among young individuals.