Fiscal Studies最新文献

Today's tax systems, in which value-added taxes and payroll taxes play a prominent role, are largely creations of the 1950s. We need to invent modern tax systems adapted to the reality of the 21^st century: the growing importance of capital and the rise of inequality. This article reviews some of the challenges involved with increasing the progressivity of tax systems in a globalised world and discusses how these challenges could be overcome. I make the case for new and more ambitious forms of international cooperation and for modern forms of wealth taxation.

This article summarises the theoretical foundations, main approaches and current trends in the field of behavioural normative economics. It identifies bounded rationality and bounded willpower as the two core concepts that have motivated the field. Since the concepts allow for individual preferences to be context-dependent and time-inconsistent, they pose an intricate problem for standard welfare analysis. The article discusses the ways in which two prominent approaches – the preference purification approach and the opportunity approach – have tackled the problem. It argues that shortcomings in each of these approaches motivate an agency-centric perspective. The article presents two concrete policy proposals of the agency-centric approach. While this approach is promising, the article argues for pluralism in normative economics since an exclusive focus on agency can likely not do justice to the multifarious concerns that citizens hold.

An adequate normative economics – one that is consistent with recent developments in our discipline (and in philosophy and psychology) and that resonates with widely held moral intuitions – will have to address the following challenges. First, utility cannot be both the basis of our predictions of economic behaviour and the evaluation of the outcomes of this behaviour. Second, we need to conceive of individual well-being and other desiderata in ways that are interpersonally comparable and that go beyond efficiency and fairness. Third, the representation of the economy as a ‘morality-free zone’ (requiring that contracts, including employment contracts, are complete) must give way to a recognition of the unaccountable exercise of power by private actors, even in a perfectly competitive equilibrium, and the way that this may violate democratic principles and limit the freedom and compromise the dignity of other actors. Fourth, the commitment to ‘liberal neutrality’ (thereby sidestepping the evaluation of preferences) and the related assumption of ‘unrestricted preferences’ in mechanism design and public policy must be abandoned, making room for a concern about the nature of our preferences and the ways that institutions shape our values.

Using the Consumer Expenditure Survey, we document the level and variability of quarterly consumption across the socio-economic distribution. While the measurement of well-being is focused on income, the secular and policy discourse prioritises income-adequacy to meet family needs. This concern over income-adequacy centres on the capacity of families to predictably consume minimally acceptable levels of basic needs, and the social and economic mobility consequences of low consumption. Our results show a clear socio-economic and demographic gradient of lower consumption amid higher consumption variability for disadvantaged groups. Food, entertainment, and personal care goods and services exhibit relatively high levels of consumption variability among low-income households.

The contributions of economists have long included both positive explanations of how economic systems work and normative recommendations for how they could and should work better. In recent decades, economics has taken a strong empirical turn as well as having a greater appreciation of the importance of the complexities of real-world human behaviour, institutions, the strengths and failures of markets, and interlinkages with other systems, including politics, technology, culture and the environment. This shift has also brought greater relevance and pragmatism to normative economics. While this shift towards evidence and pragmatism has been welcome, it does not in itself answer the core question of what exactly constitutes ‘better’, and for whom, and how to manage inevitable conflicts and trade-offs in society. These have long been the core concerns of welfare economics. Yet, in the 1980s and 1990s, debates on welfare economics seemed to have become marginalised. The articles in this Fiscal Studies symposium engage with the question of how to revive normative questions as a central issue in economic scholarship.

Economics has traditionally understood ‘welfare’ (what makes a life go well) as the satisfaction of preference. This conceptualisation of welfare is typically measured using revealed preferences, proxied through income and prices or stated in willingness-to-pay surveys. Recent decades have seen growing challenges to this paradigm. The climate crisis, among other phenomena, has called into question whether income and price data effectively proxy preferences, and willingness-to-pay surveys continue to struggle with accurately pricing important items such as biodiversity, digital goods, privacy and social connections. Preference satisfaction as a welfare criterion has also been challenged conceptually by psychologists and scholars working in the development space, among others. In this article, we review recent innovations in alternate ways of conceptualising and measuring welfare for the purposes of economic welfare analysis. We focus on using stated preferences over aspects of well-being, life-satisfaction scales and the WELLBY approach, and well-being frameworks such as Bhutan's Gross National Happiness Index. While not without weaknesses, these approaches also have marked strengths relative to the traditional approach.