The long-run properties of a dynamic Mirrlees' model with aggregate shocks

• Ano de defesa: 2013
• Autor(a) principal: Santiago, Diego C.
• Orientador(a): Costa, Carlos Eugênio Ellery Lustosa da
• Tipo de documento: Dissertação
• Tipo de acesso: Acesso aberto
• Idioma: eng
• Palavras-chave em Português: Tributação ótima; Incerteza agregada; Abordagem Mirrleesiana; Modelo Mirrlees dinâmico
• Palavras-chave em Inglês: Optimal taxation; Aggregate uncertainty; Mirrleesian approach
• Link de acesso: https://hdl.handle.net/10438/11204

We assess the existence of a long run stationary distribution of expected util- ities in a dynamic Mirrlees’s (1971) incentive structure when the government has only imperfect record keeping and the economy is subject to aggregate shocks. When aggregate shocks are i.i.d., we prove the existence of such a distribution and partially characterize the steady-state allocations. We show that the consumption share of each cohort is invariant to the aggregate state. In contrast, when aggre- gate shocks are persistent, efficient allocations display history dependence, and an invariant distribution need not exist.