Pareto-improving tax reforms and the Earned Income Tax Credit

Category: Applied Microeconomics and Organization Seminar
When: 19 Januar 2022
, 14:15
 - 15:30
Where: Frankfurt School, room S3.06

Title: Pareto-improving tax reforms and the Earned Income Tax Credit

Abstract: This paper provides necessary and sufficient conditions for the existence of Pareto-improving tax reforms. The conditions can be expressed as sufficient statistics and have a wide range of potential applications in public finance. We discuss one such application in detail: the introduction of the Earned Income Tax Credit (EITC) in the US. We find that the EITC can be viewed as a response to an inefficiency in the tax and transfer system prevailing at the time. This adds a new perspective to the literature on why the EITC is a good idea, emphasizing Pareto improvements rather than equity-efficiency trade-offs.



Organization of the seminar:


  • This seminar is planned as face-to-face event at the Frankfurt School.
  • The 3G rule applies to participation in the seminar, i.e. you can only take part in person, if you are either vaccinated, tested or recovered from Covid. Please carry the respective certificate with you.
  • There is a general obligation to wear medical masks in the buildings of Frankfurt School and Goethe University.
  • Detailed information will follow in the invitation email