000			03231cam a22004817a 4500
001			w30015
003			NBER
005			20220616160830.0
006			m o d
007			cr cnu||||||||
008			220616s2022 mau fo 000 0 eng d
040			_aMaCbNBER _beng _cMaCbNBER
100	1		_aBoerma, Job.
245	1	0	_aBunching and Taxing Multidimensional Skills / _cJob Boerma, Aleh Tsyvinski, Alexander P. Zimin.
260			_aCambridge, Mass. _bNational Bureau of Economic Research _c2022.
300			_a1 online resource: _billustrations (black and white);
490	1		_aNBER working paper series _vno. w30015
500			_aMay 2022.
520	3		_aWe characterize optimal policies in a multidimensional nonlinear taxation model with bunching. We develop an empirically relevant model with cognitive and manual skills, firm heterogeneity, and labor market sorting. The analysis of optimal policy is based on two main results. We first derive an optimality condition − a general ABC formula − that states that the entire schedule of benefits of taxes second order stochastically dominates the entire schedule of tax distortions. Second, we use Legendre transforms to represent our problem as a linear program. This linearization allows us to solve the model quantitatively and to precisely characterize the regions and patterns of bunching. At an optimum, 9.8 percent of workers is bunched both locally and nonlocally. We introduce two notions of bunching - blunt bunching and targeted bunching. Blunt bunching constitutes 30 percent of all bunching, occurs at the lowest regions of cognitive and manual skills, and lumps the allocations of these workers resulting in a significant distortion. Targeted bunching constitutes 70 percent of all bunching and recognizes the workers' comparative advantage. The planner separates workers on their dominant skill and bunches them on their weaker skill, thus mitigating distortions along the dominant skill dimension. Tax wedges are particularly high for low skilled workers who are bluntly bunched and are also high along the dimension of comparative disadvantage for somewhat more skilled workers who are targetedly bunched.
530			_aHardcopy version available to institutional subscribers
538			_aSystem requirements: Adobe [Acrobat] Reader required for PDF files.
538			_aMode of access: World Wide Web.
588	0		_aPrint version record
690		7	_aGeneral _2jelc
650		7	_aGeneral _2jelc
084			_aE0 _2jelc
690		7	_aGeneral _2jelc
650		7	_aGeneral _2jelc
084			_aH0 _2jelc
690		7	_aTaxation, Subsidies, and Revenue _2jelc
650		7	_aTaxation, Subsidies, and Revenue _2jelc
084			_aH2 _2jelc
690		7	_aEfficiency • Optimal Taxation _2jelc
650		7	_aEfficiency • Optimal Taxation _2jelc
084			_aH21 _2jelc
700	1		_aTsyvinski, Aleh.
700	1		_aZimin, Alexander P.
710	2		_aNational Bureau of Economic Research.
830		0	_aWorking Paper Series (National Bureau of Economic Research) _vno. w30015.
856	4	0	_uhttps://www.nber.org/papers/w30015
856			_yAcceso en línea al DOI _uhttp://dx.doi.org/10.3386/w30015
942			_2ddc _cW-PAPER
999			_c389446 _d348008