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A Note on Efficient Taxation
Abstract
This note was inspired by a 1970 JPE paper by Robin Barlow, who claimed that if the ratio of income elasticity to price elasticity of a public good exceeded the elasticity of tax rate with respect to income, then too little public goods would be supplied under majority voting. This note shows that Barlow's claim is not true in general, but also shows that with some fairly plausible additional assumptions it is true.
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