Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/296450 
Year of Publication: 
2023
Citation: 
[Journal:] Theoretical Economics [ISSN:] 1555-7561 [Volume:] 18 [Issue:] 4 [Year:] 2023 [Pages:] 1665-1710
Publisher: 
The Econometric Society, New Haven, CT
Abstract: 
Economic disruptions generally create winners and losers. The compensation problem consists of designing a reform of the existing income tax system that offsets the welfare losses of the latter by redistributing the gains of the former. We derive a formula for the compensating tax reform and its impact on the government budget when only distortionary tax instruments are available and wages are determined endogenously in general equilibrium. We apply this result to the compensation of robotization in the U.S.
Subjects: 
Compensation principle
distortionary taxation
general equilibrium
wage disruption
JEL: 
H21
H31
D61
D63
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by-nc Logo
Document Type: 
Article

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