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Progressive Estate Taxation

By Gerry W. Beyer
Emmanuel Farhi (Student, Massachusetts Institute of Technology (MIT) – Department of Economics) has recently posted his article entitled Progressive Estate Taxation on SSRN.

Here is the abstract:

For an economy with altruistic parents facing productivity shocks, the optimal estate taxation is progressive: fortunate parents should face lower net returns on their inheritances. This progressivity reflects optimal mean reversion in consumption, which ensures that a long-run steady state exists with bounded inequality – avoiding immiseration.

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Articles and Estate Tax